Customs and Excise

Earl Attlee: My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I remind the House that I am president of the Heavy Transport Association.
	The Question was as follows:
	To ask her Majesty's Government whether Her Majesty's Customs and Excise are under parliamentary control and operate in accordance with the European Convention on Human Rights.

Lord McIntosh of Haringey: My Lords, Her Majesty's Customs and Excise is responsible to the Chancellor of the Exchequer and, in common with other public bodies, is bound under the terms of the Human Rights Act 1998 to carry out its responsibilities in a manner compatible with the European Convention on Human Rights.

Earl Attlee: My Lords, I am grateful for the Minister's somewhat optimistic reply. I fully accept the need for Customs and Excise to be able to seize a vehicle involved in smuggling. But is the Minister aware that the transport industry is becoming increasingly fed up with Customs and Excise seizing vehicles and then retaining them for considerable lengths of time without any involvement from the courts, except by means of appeal? Would not it be better if there were a requirement for a warrant to be issued by magistrates if Customs and Excise felt it necessary to retain a vehicle beyond, say, five days?

Lord McIntosh of Haringey: My Lords, I am surprised that my purely factual reply was described as optimistic. Of course, the courts are involved. An individual or company whose vehicle is seized can challenge that seizure within one month of the date of the seizure. If there is a challenge, Customs is obliged to begin magistrates' court proceedings to declare the vehicle forfeit so that it can continue to retain the vehicle. If the magistrates agree with applicant companies or individuals, they get the vehicle back. If not, then exactly what the noble Earl asks for has been achieved. In any case, there can be an appeal to the Crown Court.

Lord Campbell-Savours: My Lords, my noble friend will be aware of the case of Orchard v. Customs and Excise which was held last year before the VAT and Duties Tribunal about the confiscation of a motor vehicle and contents in Dover. Does he know what has been the Government's response to the letter of formal notice that initiated an infringement procedure under Article 226 of the EC treaty issued by the Taxation Commissioner, Frits Bolkestein, on behalf of the Commission, and whether that has led to any reform of the practices at Dover?

Lord McIntosh of Haringey: My Lords, Customs and Excise replied to the letter last December, but no formal response has been received. The Commission recently decided to defer any decision on whether to act until the autumn. We are disappointed by that, because the Commission should understand that our view is fair and balanced. The provisions are aimed not at the ordinary shopper but at highly organised smugglers.

Lord Skelmersdale: My Lords, I believe that the Minister mentioned an appeal to the magistrates' court after a month. That is all very well for vehicles, but what about their perishable contents?

Lord McIntosh of Haringey: My Lords, I understand that those who have perishable contents in their vehicles are invited to take them away when the vehicle is seized.

Lord Saatchi: My Lords, have not the Government achieved the worst of all worlds with their policies in this area? They appear to have offended the hauliers represented by my noble friend Lord Attlee, the European Union and human rights groups by being too heavy handed. Yet on the other hand, they are somehow managing still to allow 17 billion cigarettes to be smuggled into the country every year.

Lord McIntosh of Haringey: My Lords, I was not aware that the noble Earl, Lord Attlee, claimed that the Freight Transport Association was offended by Customs procedures. Surely, the important consideration is that we should protect legitimate business. I should have thought that that would be the priority for the Conservative Party, just as I should have thought that it would be a priority for it not to be encouraging tax harmonisation within the European Union.

Lord Swinfen: My Lords, how many single-vehicle companies and individual owners have been put out of business by their vehicles being impounded by Customs and Excise when they ought not to have been?

Lord McIntosh of Haringey: My Lords, I do not know how many such single-vehicle companies there are, but as only 700 commercial vehicles were impounded between June last year, when the policy was introduced, and January, clearly not many of those can involve single-vehicle companies.

Lord Newby: My Lords, does the Minister accept that we have levels of smuggling into this country that we have not had since the 18th century? Does he further accept that, whatever one's views about tax harmonisation within the EU, such levels of smuggling are likely to continue whatever the level of seizures by Customs as long as excise duty rates differ so strongly between Britain and our continental neighbours?

Lord McIntosh of Haringey: My Lords, I am interested to hear that the Liberal Democrats are in favour of greater tax harmonisation. I should have thought that both Opposition parties would have taken account of the fact that our levels of duty on tobacco and cigarettes are justified by health reasons, quite apart from the fact that, otherwise, the cost that would have to be met by a reduction in expenditure on health, education and other worthy causes would be severe. If, for example, we were to reduce alcohol duties to the level prevailing in France, we would lose over £5 billion. That represents more than two pence on the rate of income tax.

Lord Elton: My Lords, tax harmonisation is the policy of making the taxes on any commodity the same throughout Europe. The difference that my noble friend is complaining about is a large one. Would not a level somewhere between the two be acceptable?

Lord McIntosh of Haringey: My Lords, a level somewhere between the two would be slightly less damaging to health and would take slightly less revenue away from health, education and other worthwhile causes. If the noble Lord wants to see such a compromise, he is welcome to try to persuade his party about it.

Poverty

Earl Russell: asked Her Majesty's Government:
	What size of income they believe constitutes a subsistence level for (a) a single person, (b) a couple and (c) a couple with two children.

Baroness Hollis of Heigham: My Lords, we do not believe that it is possible to arrive at such a figure. The measurement of poverty can include not just low income but factors such as how that income is spent, on whom in a family it is spent and for how long that low income persists. That is why we issued a consultation document on measuring child poverty last April. I hope that the noble Earl will feel able to respond to it.

Earl Russell: My Lords, if it is impossible to arrive at such a figure, how come that 10 other major European countries have done so? Will the Minister attempt to put that ignorance right, or should the House regard it as invincible?

Baroness Hollis of Heigham: My Lords, the noble Earl did not, perhaps, listen with his usual care to my Answer. No one doubts that low income is part of the problem of poverty. I shall give the example of a lone parent who has a child of 10 and is on an income of £100 after housing costs. She is divorced, has her own home and is poor because she is training to be a teacher. Her poverty is short term, and the outcomes for her and her child are good. We should also consider the case of another lone parent with a similar child and a similar income who lives in a run-down council flat, has no qualifications and has lived on benefit for 10 years. Her outcomes are likely to be poor. What matters is the persistence of poverty. The poverty that scars children is the poverty that persists. That is what we must capture in our analysis.

Lord Marsh: My Lords, given that the Government do not, on the whole, approve of means-tested benefits, how do they arrive at figures for minimum benefits if they have no figure for minimum need?

Baroness Hollis of Heigham: My Lords, we inherit benefit figures, and the benefits are then targeted at those who need them. Since our Government came into office in 1997, we have seen increases well beyond the retail prices index in many benefits. We recognised that the groups that we wished to help needed our support. For example, the income support rate for those with children under 11 was £16.90 in 1997. If that figure had been RPI-ed, it would now be £18.50. In fact, it will be £37 by October. The figure will have doubled. The carers' premium on income support for those caring for people has doubled since 1997. Pensioner couples are, on average, £25 a week better off in real terms since 1997. The Sure Start maternity grant was £100 in 1997 and is now £500.
	We inherit a benefits structure, we judge whether it meets the need, as we see it, and then we target our resources. We have a record of which we are proud.

Lord Morris of Manchester: My Lords, I welcome the Government's commitment to the eradication of child and pensioner poverty and congratulate my noble friend on continuing to face all-comers with her customary fortitude, even on occasion perhaps what the good and noble Baroness, Lady Park of Monmouth, calls "the termites of the Treasury". But can she say what the Government believe to be the minimum income, after rent and council tax, necessary to protect expectant mothers from being at risk of giving birth to low-weight and thus highly vulnerable babies?

Baroness Hollis of Heigham: My Lords, I do not have a figure for a pregnant woman with or without children. However, in households of below average income, the 60 per cent figure—that is, the relevant poverty line for 2001 for a lone parent with two children under 11—is £147. Benefit levels for 2003–04 will be £147. The family budget unit, to which my noble friend refers, had it been RPI-ed, would be less than what we pay in benefits. That is a decent response to the issue.

Lord Higgins: My Lords, does the Minister recall that, at the general election, the Government appeared to have no problem defining child poverty? Their manifesto said that in the previous Parliament over a million children had been taken out of poverty. Subsequently, official statistics showed that claim to be wrong. Now the Government say that we must change the definitions. Will there be no definition against which to judge the Prime Minister's commitment to take children out of poverty within a generation until the inquiry is finished?

Baroness Hollis of Heigham: My Lords, I wish to make two points in response to the noble Lord. First, as a result of our policies since we came into office in 1997, 1.4 million children—not 1 million—have been taken out of poverty compared with the number that had been in poverty. I see that the noble Lord is shaking his head; I can write to him with the figures. I can assure him that they are correct. Some 1.4 million of those children who were living in poverty in 1997 are no longer living in poverty.
	Secondly, we set ourselves another test, one that relates to wages rather than simply looking over and above the baseline figure from 1996–97. The test suggests that child poverty affects those children currently living below 60 per cent of median income. That means that as the wealth of the country increases, if benefits are only inflation-proofed then the gap will grow. We are one-third of the way to meeting our child poverty targets in one-third of the time. We have done very well, but we still have a long way to go. However, I am confident that our new tax credits policies will take us much further along the way.

Lord Tebbit: My Lords, do the responses of the noble Baroness to the questions put by my noble friend and by the noble Earl, Lord Russell, suggest that one cannot define poverty as a state existing below a certain level of income but that it can be defined only in relation to the incomes of other people? Surely that cannot be poverty. If the noble Lord the Leader of the House were to be given a substantial pay increase next year, that would not make me any the poorer, would it?

Baroness Hollis of Heigham: My Lords, as my noble friend has just pointed out, it may not make the noble Lord any poorer; it may simply make him envious. However, the noble Lord is right. The problem with a relative measure of poverty is that one then measures inequality as much as one measures poverty. That was why, in response to his noble friend, I sought to make a distinction between what might not exactly be termed as "absolute" poverty but the benchmark of when we came into office and what we have done since then compared with relative poverty.
	Following the line of the noble Lord, Lord Tebbit, the best way for the Government to meet their child poverty targets would be for the Chancellor of the Exchequer so to mismanage the economy that national wealth reduced. As a result, therefore, the relative figure would rise. However, while that would be jolly good for child poverty targets, it would be jolly bad for child poverty.

Earl Russell: My Lords, without prejudice to the first Answer given by the Minister, does she accept that there can be such a thing as an income too low for subsistence?

Baroness Hollis of Heigham: My Lords, it is certainly true that, for reasons I do not fully understand, some people are living on incomes below the level of benefit income. They tend often to be self-employed people who are living off their stock. However, the noble Earl will also know that the statistics with regard to people living on very low incomes are not particularly robust—indeed, they are pretty flaky.
	The noble Lord, Lord Tebbit, identified a problem. The test of measuring poverty which the Government have set themselves—the test of relative poverty—does not pick up other considerations such as the persistence of poverty. It is that persistence which scars. That is why we are consulting widely on re-measuring child poverty. I have checked that the relevant document is available in the Printed Paper Office. We have produced four ways of measuring it. At a seminar of academics and voluntary groups that I attended last week, several further methods were put forward.
	We need to hold the widest possible consultation and achieve the widest possible consensus in order to arrive at a measurement of poverty that is transparent, robust and holds government to account, and, in turn, gives government proper policy levers in order to take action. If the noble Earl, Lord Russell, responds to our document, I hope that he will become a part of that way forward.

Road Safety

Lord Bradshaw: asked Her Majesty's Government:
	Whether they are satisfied with progress towards achieving the road safety targets in the 10-year plan.

Lord McIntosh of Haringey: My Lords, the Government remain fully committed to their road casualty reduction targets for 2010 set out in the strategy document, Tomorrow's Roads: safer for everyone, and will take all necessary measures to achieve them.

Lord Bradshaw: My Lords, I thank the Minister for that reply. In view of the fact that the recently published road safety statistics show that accidents are increasing, does he agree with the Select Committee in another place, which said that speed is a major factor in road accidents? I shall quote a phrase from the committee:
	"The Government needs to give political leadership".
	What steps are the Government taking, bearing in mind that they have tightened significantly the criteria for the siting of speed cameras; they have refused to do anything about people using mobile telephones while driving; and the fact that their love affair with the extreme elements of the motoring lobby is quite contradictory to their targets set out in the 10-year road safety plan?

Lord McIntosh of Haringey: My Lords, the most recent accident statistics, as the noble Lord, Lord Bradshaw, describes them, should be taken in terms of deaths and serious injuries. That is the measure we take. While there has been a slight increase in the number of deaths, there is a continuing decline—as has been the case for many years now—in the number of deaths and serious injuries taken together.
	It is quite true that the Select Committee pointed out that speed is one of the most significant elements in road accidents. We continue to keep speed limits under review. I should remind the noble Lord, Lord Bradshaw, that, under certain circumstances, local authorities are empowered, without the need to refer to central government, to reduce speed limits in their own areas. Speed cameras have formed another significant element in speed reduction. There is no doubt that speed cameras work, but it is important that they should be seen by motorists as a means of reducing accidents rather than as a means of raising money for the Treasury. That would reduce confidence in our policies in general.

Baroness Gibson of Market Rasen: My Lords, evidence shows that between 800 and 1,000 people are killed each year in work-related road accidents. Can my noble friend assure the House that the Health and Safety Commission and the Health and Safety Executive will have sufficient resources to be able to extend their activities into this area of work?

Lord McIntosh of Haringey: My Lords, we are aware of the Health and Safety Commission task force on this subject. We have received a report from the Health and Safety Commission on the matter, which has been placed in the Library of the House. We are now considering our response. I hope that there will be no significant delay in the Government's response to this important report.

Lord Roberts of Conwy: My Lords, does the noble Lord agree that a major contribution to road safety has been made by the motorways of this country? Does he further agree that what is now required in order to reduce traffic congestion and gridlock, and to increase road safety, is more motorways?

Lord McIntosh of Haringey: My Lords, I do not think that that follows at all. It is certainly true to point out that two things have happened at the same time: the first is that there has been a continuing reduction in the number of deaths and serious injuries on our roads, which is to be welcomed; secondly, accidents on motorways are at a lower level than is the case on other types of road, where the road area is shared by pedestrians and cyclists as well as motor vehicles. It does not follow from that at all that we should have more motorways.

Baroness Williams of Crosby: My Lords, can the Minister respond in further detail to the question raised by my noble friend with regard to the use of mobile telephones while driving? It is very troubling to see people using mobile telephones while driving at high speeds on the motorway. Do the Government have any intention to legislate in this area?

Lord McIntosh of Haringey: My Lords, I think that we have all experienced people using their mobile telephones in what appear to be dangerous situations. I have been overtaken both on the outside and on the inside by drivers carrying mobile phones. It is an offence to drive dangerously and using a hand-held mobile telephone is dangerous. However, it does not follow necessarily that it should be a specific and separate offence to drive while using a hand-held mobile telephone, although that may become necessary if we cannot persuade drivers not to do it. I remind the noble Baroness, Lady Williams, that after the wearing of seat belts was made compulsory, it took very many years for the belts actually to be used. We still think that, for the present and until we are convinced otherwise, the existing legislation covers this point.

Lord Faulkner of Worcester: My Lords, does my noble friend agree with the concern expressed by the Select Committee in the other place about the 11 per cent decline in the number of traffic police over the past four years? Can he reassure the House that the Government intend to ask police forces to make traffic policing a priority in the national policing plan?

Lord McIntosh of Haringey: My Lords, I can certainly confirm that traffic policing is a part of the general aims and objectives of police forces and is therefore a priority. I am not quite sure what are the numbers of traffic police. The work of traffic police is often integrated with crime prevention and crime discovery activities, which seems sensible. It is often difficult to tell whether a policeman is acting only as a traffic policeman. In any case, it is the use of technology which is very much helping in the reduction of traffic accidents.

Baroness Trumpington: My Lords, have the figures been split between cars and motor-bikes? The Minister concentrated on cars, but have there been more motor-bike deaths and accidents recently? My experience is that motor-bike riders swish through the lumps and bumps in the road, whereas cars have to pull up and go slower.

Lord McIntosh of Haringey: My Lords, the figures I gave related to motor vehicles, including motor-bikes. It is certainly true that motor-bikes are much more dangerous for the drivers than passenger cars.

Viscount Astor: My Lords, I hope that—

Lord Williams of Mostyn: My Lords, we really must go on to the next Question. I gave way to the noble Baroness, Lady Trumpington, because she kept importuning me.

Sikhs

Baroness Anelay of St Johns: asked Her Majesty's Government:
	Whether they recognise Sikhs as a distinct ethnic group.

Lord Filkin: My Lords, we do, in accordance with the Law Lords' judgment of 1983 in the case of Mandla v Dowell Lee, which established that Sikhs are an ethnic group for the purposes of the Race Relations Act. If memory serves me right, the noble and learned Lord the Lord Chancellor, in his former life, appeared for the successful appellant.

Baroness Anelay of St Johns: My Lords, I thank the Minister for that Answer. Is he aware that the Sikh community in this country is so disappointed with the Government's general stance over the operation of the Race Relations Act that it is lobbying Parliament today to ask the Minister to reconsider current policy to catch up with the needs of today, and to accept that public authorities must monitor Sikhs separately for racial monitoring purposes? This is to ensure that the estimated 700,000 strong British Sikh community is given proper protection, especially following the events of September 11th, from discrimination in the operation of the Race Relations (Amendment) Act. Will the Government now consider issuing guidance so that all public authorities, not only some, are left in no doubt that they must take action on this matter?

Lord Filkin: My Lords, I was aware of the lobby and its views. I look forward to discussing this issue in more detail with representatives of the Sikh community when I meet with them at the end of this month. In short, the representations made did not persuade the Office for National Statistics, which consulted the CRE on this issue, that it was necessary to include Sikhs as a separate category in the 1991 or 2001 censuses. But, of course, Sikhs would have been able to put "Sikh" on the census form under the "other" category, if they so wished. They will also be identified as a religious group, which was included in the 2001 census for this purpose.

Lord Dholakia: My Lords, while accepting that the Mandla judgment identified Sikhs as a distinct ethnic group, it also created a number of anomalies in that other groups have been excluded from the definition. What do the Government have in mind to ensure that such groups, particularly those with religious beliefs, are included in future equality legislation?

Lord Filkin: My Lords, both in my role and more widely across Government we are well aware of the sensitivity of this issue and of the importance in a multiracial and multi-ethnic society of properly reflecting the diversity that exists. Therefore, I am certain that before the next census—if it proceeds in the form of previous censuses—there will be the most careful consultation on this issue. We shall also seek proper consultation on the other circumstances in which it will arise in the future.

Lord Avebury: My Lords, is the noble Lord aware that the advice being given by the CRE to public authorities on how they should conduct ethnic monitoring in connection with their obligations to produce statements of race equality, requests them to use the ethnic categories contained in the census? Therefore public authorities will not have particular regard to the special needs of the Sikhs, or indeed of any other minority community which is not named in the census. Does the Minister agree that the advice being given by the CRE should be revived to take into consideration the diversity of ethnic groups in our society?

Lord Filkin: My Lords, the code of practice gives the advice signalled by the noble Lord, Lord Avebury—that is, that it is sensible to make it possible to compare local data with the census data. That is common sense because, without those comparisons, many other issues are difficult in policy terms. On the other hand, the code of practice also states that it is open for a local authority or police force to disaggregate, if they so wish, within a particular category to allow the finer grain detail in their monitoring that the noble Lord, Lord Avebury, advances. The code of practice, therefore, permits exactly what the noble Lord proposes.

The Lord Bishop of Wakefield: My Lords, there is a significant Sikh community in Huddersfield, which is in my diocese, and a large Muslim community. There is also a quite significant Christian Asian community. In terms of the Question, can the Minister define where he sees an "Asian Christian" community.

Lord Filkin: My Lords, shooting from the hip, I would have thought that a Christian Asian would have indicated "British Asian" under the question about ethnic origin in the census; and, under the question about religious affiliation, would have written "Christian".

The Earl of Sandwich: My Lords, given the historic commitment of the Sikh people to this country, is it not time that we had a turban in this House?

Lord Filkin: My Lords, that is an interesting and important question, which I am sure will be noted. I agree that Sikhs have made a great contribution to Britain. They are a proud race who fought the British in India and fought with the British in the last two wars. They have made many significant contributions to the social and economic life of this country.

National Insurance Contributions Bill

Read a third time, and passed.

Consolidated Fund (Appropriation) (No. 2) Bill

Lord McIntosh of Haringey: My Lords, I beg to move that this Bill be now read a second time.
	Moved, That the Bill be now read a second time.—(Lord McIntosh of Haringey.)
	On Question, Bill read a second time; Committee negatived.

Education Bill

Read a third time.
	Clause 1 [Purpose and interpretation of Chapter 1]:

Baroness Ashton of Upholland: moved Amendment No. 1:
	Page 2, line 1, leave out subsection (3).

Baroness Ashton of Upholland: These are minor technical amendments which we should have included with our previous amendments to the clause. I apologise to the House for that omission.
	The current definition of "children" is expressed to refer to subsection (1) only. Now that we have introduced references to "children" in Clause 1(2) and Clause 2(5) we need to ensure that the definition applies to the whole chapter. The amendments achieve that. I beg to move.

Baroness Blatch: My Lords, perhaps I may ask the Minister a question. A concern that has always received a great deal of sympathy in this House in relation to young people with special educational needs—"looked-after children", to invoke the reference of the noble Earl, Lord Listowel—is in relation to children between the ages of 19 and 25. What is the status of that age group when it comes to meeting their needs?

Baroness Ashton of Upholland: My Lords, we have always made sure that within legislation we define where the application of different age groups is. For the purposes of this Bill, what I have said is what would apply. I take the noble Baroness's point. But it would be the case that that is applicable for those particular groups in legislation as we have said throughout. So in this context, it is not applicable; but it would be applicable in legislation where we made a point of referring to that particular age group. I am happy to send an explanation to the noble Baroness and place a copy of my letter in the Library of the House, but that is the case for the purposes of this part of the Bill.

On Question, amendment agreed to.

Baroness Ashton of Upholland: moved Amendment No. 2:
	Page 2, line 7, at end insert—
	""children" means persons under the age of nineteen;"
	On Question, amendment agreed to.
	Clause 2 [Power to suspend statutory requirements etc.]:

Baroness Darcy de Knayth: moved Amendment No. 3:
	Page 3, line 10, at end insert—
	"(5A) Notwithstanding the provisions of subsection (5), no order under this section shall confer on the applicant exemption from any of the provisions determined by the following sections of the Education Act 1996 (c. 56)—
	(a) section 321 (the duty to identify children with special educational needs as defined by section 312);
	(b) section 317 (the duty on governing bodies of schools to use their best endeavours to meet the needs of pupils with special educational needs);
	(c) section 323 (the duty to assess children's special educational needs, when necessary);
	(d) section 324 (the duty to make and maintain statements of special educational needs, when necessary);
	(e) section 331 (the duty to assess and provide for children under 2 years of age)."

Baroness Darcy de Knayth: My Lords, in moving this amendment, I shall speak also to Amendment No. 4, which represents a fallback position designed to incorporate in regulations the list of key duties set out in Amendment No. 3; namely, duties of school governing bodies and LEAs towards children with special educational needs.
	The purpose of both amendments is to secure for the future the legal safety net for children with special educational needs which was created by certain duties in the Education Act 1981 and which now form part of the Education Act 1996. I am very grateful to my noble friend Lady Warnock, the catalyst of the 1981 Act, and to the noble Baroness, Lady Blatch, the mother of the 1996 Act, for adding their names to these amendments. The proposals have the backing of the Special Educational Needs Consortium, which includes IPSEA. I should declare that I am a patron of IPSEA. These essential duties are set out in Amendment No. 3. I am encouraged that they were identified, apart from Section 331, as key duties in special education law by the Audit Commission in its recent report.
	Why are they necessary? Clause 2 as it stands allows the Secretary of State or the National Assembly for Wales to exempt applicant schools and LEAs from any requirements of education legislation to allow the implementation of innovative projects that may, in the opinion of the Secretary of State, contribute to the raising of educational standards.
	Both in Committee and on Report, several noble Lords moved and spoke to amendments supported by the SEC which were designed to remove legislation relating to children with special educational needs from the Secretary of State's power to exempt.
	I shall not bore your Lordships by repeating the speech that I made in Committee on 2nd May, at cols. 845 to 846, stressing that the protection afforded by the statement of special education provision depends on the linking together of several separate duties as set out in Amendment No. 3. Paragraph (b) referring to Section 317 relates to children with special educational needs but without a statement.
	As with any chain, the removal of one link—for example, an LEA being relieved of one of its legal duties by a future Secretary of State—would totally undermine a child's legal entitlement to special educational provision. One duties goes, and the safety net collapses.
	No one was saying that we should not innovate, but people were concerned that the Bill as it stood threatened the legal safety net. The noble Lord, Lord Lucas, summed it up very well in our debate on 2nd May when he said that the Government must,
	"find a way of making the protections sacrosanct, while leaving as much room as possible for SEN education to do better than is the case at present".—[Official Report, 2/5/02; col. 848.]
	The Minister argued at both stages that our amendments would not allow innovative projects to apply to children with SEN. On Report she brought forward an amendment requiring the Secretary of State or the National Assembly for Wales to refuse to use the power to exempt if it,
	"would be likely to have a detrimental effect on the education of children with special educational needs".
	That requirement is now included in Clause 2(2)(5). The consortium welcomed this amendment as affording some protection from the consequences of exemption from education legislation. The noble Baroness, Lady Sharp, and my noble friend Lord Rix were satisfied that the amendment secured the protection we had been seeking.
	Throughout the passage of the Bill, the Minister has been very generous with the time she has given us for meetings and discussions. I stress that I am in no way imputing an evil intention to the Minister. I know that she is fully committed to the improvement of the lot of children with SEN. During our discussions, I said that I was satisfied with the proposed amendment, but I became increasingly uneasy, as did the SEC, that nowhere does the government amendment in Clause 2(2)(5) state that the key duties are secured. It leaves it to any future Secretary of State to determine whether their suspension would have a detrimental effect on the education of children with special educational needs. I am immensely encouraged by the support of my noble friend Lady Warnock and of the noble Baroness, Lady Blatch.
	Why are we so concerned about the safety net? Innovation and flexibility go hand in hand. Many noble Lords will recognise that "flexibility" can send a shiver down the spine of those who provide support and advice for the parents of children with special educational needs. Noble Lords will remember the debate about quantification of special educational provision in statements, about woolly statements—so christened by the noble Lord, Lord Lucas—being detrimental, and how the then Secretary of State, David Blunkett, agreed two hours before the Second Reading of the Special Educational Needs and Disability Bill that the provision should be specified rather than set out. During the course of that Bill, the noble Baroness, Lady Blackstone, brought forward many amendments in response to mine to plug loopholes in the 1996 Act. The noble Baroness, Lady Ashton, was rightly applauded for her courage and common sense in taking back the draft code of practice and rewriting the relevant parts—one of her first acts as a Minister. All this required pressure and vigilance.
	The noble Earl, Lord Russell, is wont to say that Ministers resisting an amendment have two arguments: either that it is wrecking, or that it is unnecessary. I now understand that, while not wrecking the Bill, our previous attempts at amendments all had the effect of barring any innovation for children with special educational needs. I hope that the Minister will not argue that these amendments, pared down to the bare essentials, are unnecessary.
	Amendment No. 3 would exempt only the key duties from Clause 2 and would in no way inhibit the ability of LEAs or schools to develop innovative projects aimed at better meeting the needs of all children, but it would keep the safety net in place, just in case, for those children with special educational needs. Let us remember that it is only for the few—the 2 per cent, not the 80 per cent—of those with special educational needs who need the protection of the statement where their school or nursery cannot meet their needs with provision ordinarily available.
	Amendment No. 4 would enable all these duties to be specified in regulations, if the Minister agrees—although obviously it would be preferable to have that specified on the face of the Bill. What we need is to be sure that these key duties will remain the law despite exemption for innovation. I hope that the Minister will respond very positively either by accepting one of the amendments or by finding some other way of reassuring us beyond all doubt. It may be that the noble Baroness, Lady Sharp, and my noble friend Lord Rix are right and that the protection is there. But many of us are concerned, as is the SEC. We need it clearly stated that the key duties will remain in place as a matter of law and not at the discretion of the Secretary of State. I beg to move.

Baroness Warnock: My Lords, I want to speak briefly in support of the amendment. I have in mind two points which it makes clearly. One is that the children who are most at risk of being swallowed in the excitement of innovations of various kinds may well be those children who fall into the so-called 80 per cent of children who will not have statements. Those are the children who are most in need of having this protection on the face of the Bill.
	Secondly, in the new subsection (5A)(a) proposed by the amendment, the duty to identify children with special educational needs must be protected. I believe this to be the most important part of the amendment. A school may innovate by introducing enrichment programmes and all kinds of different ways of teaching children who may have high ability, which I greatly welcome. Nevertheless, in whatever category or class of children—I mean "class" literally—there are certain to be a number of children who will not have statements but who will be entering into, perhaps temporarily, a condition of special educational needs and who have emotional or behavioural problems or who are falling behind in one way or another. It is essential, in the spirit of previous Acts, beginning with the 1981 Act, that the protection for such children should be on the face of the Bill.

Baroness Uddin: My Lords, I hesitate to rise given that I did not take part in the Second Reading debate. This is a subject close to my heart and I would do myself no justice if I did not say a few words. I support Amendment No. 3, particularly with reference to the issues raised by the noble Baroness, Lady Warnock, concerning the need to identify children's educational needs. I echo everything said by the noble Baroness, Lady Darcy de Knayth. She paid due respect to the Government's position up to now, but it is critical that we maintain the spirit of the amendment as tabled. I look forward to the Minister's response.
	For a long time parents have fought tooth and nail to have the right to statements. To leave those parents and children exposed to the flexibility of the governing body or the LEA is inappropriate and unwise, given the experience of a minority of children. I note with some concern that the amendment does not address the issue of service provision. It is all very well having grand plans for children and services, but parents are often dissatisfied with the way that statements are provided. Service delivery is important. I am disappointed that neither this amendment nor the others tabled address that issue.

Baroness Blatch: My Lords, I have added my name to the amendment. It is fair to say that there is a great deal of meeting of minds across the Chamber. The noble Baroness, Lady Darcy de Knayth, mentioned that the Minister has been sympathetic and has put forward amendments. The noble Baroness, Lady Darcy de Knayth, is equally understanding about the need to achieve the Government's ends; namely, to allow for innovation to be freely undertaken in schools.
	We all agree that it should not be done at the expense of provision for young people with special educational needs. The difficulty is the distinction as to whether it should be a game of chance and left to the discretion of the Secretary of State, or whether it should be a matter of law by removing the discretion. There could be occasions when a Secretary of State makes a judgment that is more subjective than objective and everybody else takes a different view on the provision for special educational needs.
	On Report the Minister said that it was inconceivable that a decision would be taken to allow for an innovative project which, in fact, had an adverse impact on young people with special educational needs. We only ever talk about the Secretary of State that we know is in power at any given time. People often say that Secretaries of State come and they go. They vary in style and the way in which they approach making decisions. Therefore, I believe the amendment is about taking chance and discretion out and making it a matter of law that there shall be no room for allowing any project that would impact adversely on provision for young people with special educational needs.
	I suspect that we may just hear something to our liking from the Minister. If not, and the noble Baroness, Lady Darcy de Knayth, wants to press the amendment, she will have my support.

Lord Campbell of Alloway: My Lords, I apologise for speaking at all. I have not spoken on this Bill. I have been involved in another Bill. The reason I am speaking is that many years ago I introduced a Private Member's Bill on special educational needs. After a considerable battle with the Government, eventually my noble friend Lady Blatch took over at Report stage and implemented the principles in the 1996 Act.
	The reason I am speaking is that having really got in here by mistake and having discovered what was going on, it seems to me incredible that one should not have an effective measure of safeguard to preserve the statute of 1976 in its full efficacy. There should be no doubt about it at all. I do ask your forgiveness for having taken the time of the House.

Lord Addington: My Lords, I feel slightly abashed at joining in this Who's Who of legislation on special educational needs. When the Minister tabled the amendment that is now Clause 2(5), I thought it provided the defence and framework that is required to ensure that we retain those rather hard-won defences for those with special educational needs. However, enough people who know enough about this subject have raised questions for me to feel that it is just that we ask the Minister to give us chapter and verse on why she believes that it does give us this. What is the legal effect of her words in her opinion? Do we have the continuous process of ensuring the Government still have a duty to find out who has a problem and to give them some assistance?
	It has been pointed out before that if the chain is broken and we lose, say, two or three years, that is the destruction of a child's education. During the decade and a half that I have been in this Chamber there has been a continuous struggle to ensure that that chain is in place. We have browbeaten governments of various hues and various Ministers over this matter for a long time. The fact that it might be removed is a matter for genuine concern.
	We must ensure that we have not wasted all that time. Can the Minister tell us what the legal process is according to the Bill as it currently stands? Can she assure us that that process will take place and that we shall have in place what we have struggled for over those years? If so, I shall be content. However, we must hear that. If further legislation—secondary or primary—is required, the Government are duty bound to legislate. If that means that we must ask the Government to accept an amendment now so that they have time to make changes, I advise my noble friends to consider that. That is an important point. It is something we must guard because it has taken a long time winning.

Lord Lucas: My Lords, I am sure that Amendment No. 3 is entirely unnecessary from a legislative point of view. I cannot see that any Government will ever contemplate acting against what is in that amendment. Therefore, the Government should accept the amendment because it makes no difference to their freedom of action. However, it gives the many people involved with special educational needs the comfort of certainty. There is a great deal to be said in favour of certainty. If one knows that the Government can at a whim undermine the whole structure of special educational needs in this country, although it may not seem likely it is a constant worry. The Government know they will not do it. It would not harm them to take Amendment No. 3 on board. It would give everybody else great comfort.

The Earl of Listowel: My Lords, during the passage of the Bill I have been particularly concerned about children in public care and their admission to schools. Such children are currently placed in schools that no one else wants, for various reasons and circumstances. I had hoped that the Bill would provide an opportunity to remedy that situation. Sadly, for technical reasons, that is not possible.
	Some 26 per cent of looked-after children have statements of educational needs. If there is a serious concern that the protection for those 26 per cent may be in danger, I feel strongly that that should be avoided.
	I look forward to the Minister's reply and I thank her for the great deal of time that she has spent listening to my concerns on the Bill. I very much hope that she can reassure us all. If not, I shall follow the advice of my noble friends and the noble Baroness, Lady Blatch, on the amendment.

Lord Brennan: My Lords, the critical need of parents of children with special educational needs is for clarity about what they are entitled to for the benefit of their children. It would be most unfortunate if, in that sector of needy society, a debate such as this led to division. I am sure there is no sentiment towards division, but rather a desire for agreement. I therefore invite my noble friend the Minister to agree with what I understand to be the principle of the Bill and to reassure us on how that principle is to be put into practice.
	Under Clause 1, innovative projects will be permitted only if they may,
	"contribute to the raising of educational standards".
	I invite the Minister to agree that there can be no exemption from or relaxation of special needs legislation under Clause 2, on the power to suspend statutory requirements, unless the proposal would raise educational standards. In other words, such proposals must add to what is already there rather than detracting from it. That is the logical structure of Clauses 1 and 2. Innovation will better the present situation, not change it for the worse. Clause 2(5) gives additional clarity to that analysis that no exemption or relaxation will be permitted if it results in a detrimental effect on the needs of such children.
	That analysis of principle seems straightforward. I cannot imagine that a statute that is designed to better things can be interpreted by invoking a power to take away good things that already exist.
	How is that principle best put into practice? It is not only by my noble friend the Minister confirming what the principle is today, but also by her reassuring us that the department will issue guidance under Clause 2(6) at the earliest opportunity on how it will approach the granting of applications, having special regard to the statutory duties for children with special educational needs, which are set out in the amendment. That is necessary, because it would be most unfortunate if, with this desire for clarity, a system was introduced with no one—neither parent, nor local authority, nor child, if they are able to understand—knowing by what criteria the Secretary of State will make decisions on innovative projects that affect the special educational needs of children. I cannot see that that is too much to ask of the Government and it would confirm the requirement that I initially emphasised: the need for all those concerned with these children to have clarity.

Lord Swinfen: My Lords, I urge the Government to accept the amendment. The Minister will probably say that it is not strictly necessary, but I see it as a belt and braces amendment, although I am not a lawyer. At times of financial or other difficulty, special educational needs is the area of education that tends to come under the greatest pressure. A future government could well try to get round the amendment that the Minister introduced at an earlier stage. I urge her to accept this amendment.

Baroness Ashton of Upholland: My Lords, it is a great privilege to hear new voices raised in our debates in support of this most vulnerable group of children. I echo all that has been said about the Government's desire to ensure that we do what is best and right for these children.
	I am conscious that this is a Third Reading debate, but I should like to refresh the memory of those who have not been able to participate in our debates as they might have wished. This power will be on the statute books for only four years. Any school or local education authority applying for the power to innovate can be granted that power for three years, with the possibility of an extension for a further three years if the circumstances are appropriate—for example, if there has not been time to assess and evaluate what has happened. Talk of future Secretaries of State is inappropriate. I am not saying that there will always be the same Secretary of State for the next four years, but this power will disappear in four years. That is important.
	I intend to spend some time on this and I hope to be able to give the reassurances that noble Lords and others outside the Chamber are seeking about the effect of the amendments that the Government have already made. I had hoped that I had already made clear that the legislation as drafted already means that nothing could be done through this power that would disadvantage children with special educational needs. I am more than happy to repeat that and to spell it out in greater detail.
	My officials have been in conversation with the Special Educational Consortium, which was looking for some specific reassurances. The noble Lord, Lord Addington, is looking for similar reassurances. I hope that I am now able to give those.
	I hope that it is clear to all noble Lords that we are committed to the basic statutory framework that is now in place. We have recently strengthened that framework through the Special Educational Needs and Disability Act 2001. We believe that the changes we have made are good and positive. We do not want to unpick them; we wish to see them embedded.
	We do not in any way begin from the position that there is something wrong with the sections referred to in Amendment No. 3, or that we expect significant proposals for change—quite the opposite. Let me be clear about the meaning of the Bill as drafted. We have made a number of amendments to the Bill, the most significant being those that now appear in Clause 1(2) and Clause 2(5). They already provide the belt and braces that the noble Lord, Lord Swinfen, seeks. Those amendments mean not only that the Secretary of State must consider the interests of every pupil affected by a project, but also that no order may be granted if there is likely to be a detrimental effect on the education of children with special educational needs.
	Those tests are deliberately drawn widely. The Secretary of State must consider the likely effect of the project on all children who may be affected by it, whether present or future, at the school in question or at another school. The protection for children with special educational needs in Clause 2(5) is sufficiently strong that a project that would be beneficial to a significant number of other children but would be harmful to the interest of a single pupil with special educational needs could not be approved.
	The first clear point on the effects of the law in relation to the specific sections mentioned in Amendment No. 3 is that they could not be changed if that change would be likely to damage the education of children with special educational needs. No change that harmed children with special educational needs would be possible. It is clear that simply abolishing the duties in any of the sections to which the amendment refers would not be lawful. It would be detrimental to children with special educational needs, for example, to have no duty to assess or to identify. Without those duties the basic provisions for children with special educational needs would not function. Therefore it must not be lawful to remove them.
	As the noble Baroness, Lady Darcy de Knayth, pointed out, many of the duties in Amendment No. 3 are expressed as "when necessary". Clearly it is necessary for someone to act to secure the best interests of children with special educational needs, but it would be to the detriment of those children if they did not do so. It follows that having no duty on anyone to act when necessary must be to the detriment of children with special educational needs. Accordingly, it would not be lawful to remove any of those duties. I hope that I have made it as clear as I can that that is the meaning of the legislation as the Bill is drafted.
	The Bill would permit, for example, the transfer of duties from one party to another. To take an example I have used before in your Lordships' House, if under the power to innovate the governing body of a strong school were taking on responsibility for a weak school, we would be likely to want the special educational needs duties to transfer to the strong governing body. Otherwise the residual weak governing body would be left with no powers and a duty in relation to special educational needs that it would be unable to fulfil. Meanwhile, the body with the powers would be left without the duties. That would not be in the interests of children with special educational needs and therefore I do not wish to rule it out.
	It is conceivable that some adjustment to the legislation set out in the amendment could be in the interests of children with special educational needs. I have said in your Lordships' House many times that it is my strongest desire that the power to innovate should be used for these children, who may benefit from innovative approaches which cannot take place under our current legislative framework. That is why I have looked for positive approaches to innovation.
	The most obvious example, as I said, would be the transfer of duties from one body to another. Similar arguments would apply to the transfer of duties between local education authorities, or from local education authorities to voluntary bodies. In looking at the issue it is not inconceivable that a school or local education authority dealing with a number of children described as low incidence highly complex special educational needs may wish to involve one of our major voluntary organisations with knowledge, insight, experience and expertise on the particular special educational needs to work with it on the assessment of these children and to ensure that they are catered for properly.
	I do not believe that any noble Lord would wish to rule out that possibility, but that is unfortunately what would happen if the amendment was passed. It would require in law that one body be exempted from the duty, as noble Lords will appreciate, in order for another body to take it on. What is not conceivable is that the duties in those sections could simply be abolished. It could not be the case that no one would have them. I can be clear, and I believe that this is the key assurance the noble Baroness is seeking, that that would not be lawful under the legislation as it stands.
	I do not want to rule out the adjustments to the legislation that I have set out, which would be beneficial for children with special educational needs, in the interests of inserting a protection that, as I have described, is already there. So I do not believe that Amendments Nos. 3 and 4 are necessary in order to secure the protections that the noble Baroness rightly seeks.
	But I wish to go further. In any case, if there was a proposal to transfer duties of the sort I have described, we would need to be clear not only that that was in the interests of the children, but also that the position would be absolutely clear for parents. It would not be acceptable to create a position where parents would not know where to go for help, guidance or support or would not know who to hold to account in relation to the legislation. That would not be in the interests of children with special educational needs and so that too would not be lawful.
	Furthermore, any measure that left parents with no right of appeal could not be in the interests of children with special educational needs. That might be unlawful anyway for other reasons, but in any case it would not be permitted under the Bill as it stands. I can therefore be clear that the legislation as it stands satisfies the concerns raised. It also ensures that if any change were in the interests of children with special educational needs, it would be permitted. That is the goal to which I have aspired.
	But in case there remains any doubt, I wish to go further still. I have already described, in moving the government amendments on Report, how we would expect applications to be dealt with and the process that we would expect to go through in order to assess proposals in relation to children with special educational needs. I have said that we will put that in guidance, to which my noble friend Lord Brennan referred. We will make clear in guidance that we would not regard as standard-raising any proposal that simply proposed to do away with those duties. We would not expect to see any such proposals in any case. But if there was any doubt about that matter, I hope that I have put it to rest by committing the Government to setting it out in guidance.
	Finally, I know that the Special Education Consortium was concerned that it might be unable to police any proposals coming forward because it would not know about them in time. I know that the noble Baroness, Lady Darcy de Knayth, is concerned that prpoposals should not be left entirely to the Secretary of State's opinion, for all the right reasons and none of the wrong reasons. I will make the commitment that if the Secretary of State were to receive any application affecting the duties set out in the five sections included in the amendment, the Special Education Consortium would be informed and consulted about the proposals. That would ensure it would have an opportunity to be involved in decision making.
	I believe that in what I have said I have met the concerns expressed to me both inside and outside your Lordships' House. I hope that I have made it clear that the legal position is much more secure than some might have feared. In setting out the legal position in such detail, I am conscious that I have taken your Lordships' time. But I hope that all noble Lords will recognise the importance of my having done so, the strengths of the commitments I have made, and, in particular, our involvement of the Special Education Consortium in the process as more than a belt-and-braces approach to ensuring that the needs of these children remain as paramount as they should be, but also allowing the opportunity to look for innovation in our schools and local education authorities. I hope that with those words the noble Baroness will feel able to withdraw her amendment.

Lord Campbell of Alloway: My Lords, before the Minister sits down, is she aware of any precedent of a clause that has this power to suspend the statutory requirement other than in emergency legislation in wartime?

Baroness Ashton of Upholland: My Lords, I would not know that. As the noble Lord will know, we have debated the clauses at great length at other stages. I wish that the noble Lord had been able to put that question to me at a time when I could have written to him before another stage. I will of course commit to write to him with a definitive answer.

Baroness Darcy de Knayth: My Lords, before I thank the Minister for her reply, perhaps I may thank all noble Lords who have taken part in the debate for their fantastic support. I am overwhelmed. My noble friend Lady Warnock mentioned the important 18 per cent without the state's protection, as did the noble Baroness, Lady Uddin, for whose informed support I am grateful. The noble Baroness, Lady Blatch, and the noble Lord, Lord Campbell of Alloway—I am delighted he is present as I remember his Private Member's Bill which resulted in the 1993 and 1996 Acts—both referred to the importance of safeguards. I am extremely grateful for the support of the noble Lord, Lord Addington. As always, he put his finger right on the question of whether what is proposed in our amendment is lawful.
	I thank the noble Lord, Lord Lucas, for his unequivocal support. I thank also my noble friend Lord Listowel and the noble Lord, Lord Swinfen. I am particularly indebted to the noble Lord, Lord Brennan, for his careful analysis and informed advice, which did a great deal to set my mind at rest that anything to the detriment of children with special educational needs would not be lawful. I am extremely grateful to him for his suggestion that guidance would be a good idea.
	I thank the Minister for her careful and long reply. That is a compliment, not a criticism. I am delighted by the clear statement with which she began; namely, that having strengthened the SEND legislation, she had every wish to keep those matters embedded and not renege on them. The amendments to Clause 1 are extremely welcome.
	I am particularly grateful for the Minister's explanation that if a project adversely affects a single pupil with special educational needs, it could not be approved. However, what would happen as regards a new pupil entering the school after a project has started? Does the Minister wish to intervene?

Baroness Ashton of Upholland: My Lords, this is where I get lost in procedure as I understood that at Third Reading I could not reply to questions after I had made my main reply. As ever, I am at the mercy of noble Lords as regards procedure. However, as I said, a school would have to be able to demonstrate that a child arriving at that school would not be adversely affected by a project.

Baroness Darcy de Knayth: My Lords, I thank the Minister for that reply. It is clear that the key duties will remain and that it will not be lawful to remove any of them. A governing body or LEA that took over from a weaker LEA or governing body would still be bound by those duties.
	I am most grateful to the Minister for saying that she would consult the SEC when drawing up guidance, and if someone came forward with an unusual proposal, for example. The Minister also said that parents would be informed and given a right of appeal. Our amendment consciously did not mention that. I am grateful to the Minister for making that point.
	This has been a worthwhile exercise. I do not think that we have wasted the time of the House. I am glad to see that the Minister agrees. It is now clearly stated that the key duties remain. That is valuable. It is important that the Government send a clear message to service providers, especially LEAs, that they are committed to the legal framework and to the concept that children and young people should receive the special educational provision for which their needs call as a matter of legal right. Those who draft applications for innovative projects will receive the message that it is absolutely not the Secretary of State's intention to consider, let alone approve, applications which seek exemption from the key duties which LEAs have towards children with special educational needs with regard to identifying them, conducting assessments and making and maintaining statements.
	I could make one or two other remarks but I think that I have spoken for long enough. Unhesitatingly, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 4 not moved.]
	Clause 6 [Interpretation of Chapter 2]:

Baroness Blatch: moved Amendment No. 5:
	Page 4, line 41, at end insert—
	"( ) No order may be made (in relation to England) under Part 1 of this Act which includes reference to criteria prescribed under subsection (2) unless a statutory instrument containing the prescribed criteria has been laid in draft before, and approved by resolution of, each House of Parliament.

Baroness Blatch: My Lords, although we have discussed the clause to which my Amendment No. 5 refers, there remains nevertheless an important but residual issue. The Minister said on Report on 17th June:
	"In Committee, I said that I would reflect further on the nature of the criteria for earned autonomy and on the number of schools that might qualify. I can now tell your Lordships' House the outcome of that reflection".—[Official Report, 17/6/02; col. 533.]
	The outcome of that reflection was welcome as we now have, instead of a predicted 10 per cent of schools qualifying for earned autonomy, the Government's own prediction; that is, 30 per cent. I have two comments to make. First, I hope that we shall get away from percentages. We are not aiming for 10, 20, 30 or any percentage. What we want are clear criteria that are well understood by schools and objective judgment in regard to those criteria. Whatever number of schools qualify, so be it.
	However, it is depressing that the Government expect only 30 per cent of schools to qualify. At the same column of Hansard the noble Baroness continued:
	"We have always said that we want the best led and best managed schools to qualify for earned autonomy. We now wish to align the criteria for earned autonomy with those for short inspections. That will mean that, if a school has qualified for a short inspection under the current inspection arrangement and has received a good inspection, it will be eligible for earned autonomy. However, if a school receives a good inspection of any sort, we should be prepared to consider whether it might be suitable to give it additional freedoms. It will be for the chief inspector to identify those schools, and that is why the amendments that we have tabled are needed".—[Official Report, 17/6/02; col. 533.]
	Therefore, the Government have moved away from objective criteria to what the chief inspector thinks and, indeed, at the end of the day to what the Secretary of State thinks.
	If there are to be criteria, as I said a moment ago they need to be clear and well understood and everyone needs to have the security and the guarantee that those criteria will pertain when any decision is taken by the Secretary of State who will—not with my support—consider every single application that comes before the department. It is possible for different judgments to be made by different Ministers at different times.
	The other reason that I wish my amendment to be incorporated in the Bill is that the Government have moved—which we welcome—from a relatively small number of schools qualifying for earned autonomy to a figure of about 30 per cent. The criteria drawn up to decide how many schools qualify will be important. The House should not mistrust the Minister's comments but should endorse them. The criteria should not comprise just the words and the promises of the Minister but should have the endorsement of Parliament.
	I have to query why it is that 70 per cent of schools are not expected to be, in the words of the Minister, "well led and managed". It cannot be that the Government themselves say that only about 30 per cent of our schools are well led and well managed. If that is the state of education at the moment, it is a good deal worse than many of us thought. That sends a negative message to schools. I believe that the relevant percentage is a good deal higher and that many more schools should qualify for earned autonomy.
	I rest my case. I shall not go over the arguments that I deployed at the previous stage except to say that we welcome what has been achieved so far. We believe that the criteria will be critical in determining the number of schools that qualify. If the measure is endorsed by Parliament, it will remove the discretion that is left to the chief inspector and to the Secretary of State. I believe that it will gain the confidence of schools, teachers, parents and, of course, more significantly, children. I beg to move.

Baroness Ashton of Upholland: My Lords, I am absolutely with the noble Baroness, Lady Blatch, in wanting to get away from the concept of percentages. However, they are a useful guideline and they have helped our debates on the Bill to move forward. I refer to the response of the noble Baroness and others to our initial figure of 10 per cent. However, I make it clear that I referred to that figure as a starting point. I referred also to 30 per cent of secondary schools and 60 per cent plus of primary schools. We want to ensure that qualifying schools are well managed and well led so that all schools in the future will be able to move forward in terms of earned autonomy. It is a starting point, not an end point. It is important to have clarity with our proposals. I give an unequivocal assurance that the criteria will be clear. It is important—I am sure that the noble Baroness, Lady Blatch, agrees—for schools to know whether or not they qualify.
	I turn to the amendment. I simply say to the House that the Delegated Powers and Regulatory Reform Committee looked in detail at our proposals for regulation-making powers in this regard. It was content with our proposed procedures, and I hope that, as is conventional, the House will be guided by the committee's view.
	The noble Baroness suggested that the amendments made to the Bill on Report mean, in her view, that the affirmative procedure is needed. But while I certainly made it clear that our intentions in relation to what regulations would contain had changed, the changes to the scope of the regulation-making power in primary legislation were not significant. I am therefore clear—we have taken some care to examine this carefully—that there have been no changes in the primary legislation that would disturb the committee's judgment of the appropriateness of the procedure, given the extent of the powers.
	All noble Lords will know that we have been completely open throughout about our intentions for the criteria for schools qualifying for earned autonomy and their development. We made our original intentions very clear in the policy statement that was placed in the Library of your Lordships' House. We made clear our continuing intention to consult. On Report, I responded to the concerns that had been raised in Committee. I set out in some detail the Government's revised intentions in relation to the qualifying criteria under Clause 6(2).
	I have given very clear commitments on the Floor of the House, which will of course be met; I am sure that that is not in doubt. The powers in primary legislation were presented openly to the Delegated Powers and Regulatory Reform Committee and were not the subject of adverse comment. We have been open about our intentions throughout and we remain of the view—having checked very carefully, as I said—that the procedure we propose in the Bill is the appropriate one.
	Therefore, in the light of the views of the Delegated Powers and Regulatory Reform Committee in particular, I very much hope that the noble Baroness will withdraw her amendment.

Baroness Blatch: My Lords, could I ask the noble Baroness two questions, in the light of what has just been said?

Lord McIntosh of Haringey: My Lords, we are at Third Reading. We have to accept that there is one speech after the Minister has spoken.

Baroness Blatch: My Lords, I have been here for some time and my understanding is that if I wanted, for clarification, to ask questions, that was in order. I shall be advised by the Clerk. If I cannot, I cannot.

Lord McIntosh of Haringey: My Lords, the noble Baroness opened her speech by asking further questions. I do not think that this is in order. If she had stood up before the Minister had sat down and had asked a question, that would have been in order. However, she is now making her wind-up speech and we must be satisfied with that.

Baroness Blatch: My Lords, I said that in the light of what the noble Baroness said, I had two questions. I shall be advised by the Clerk. If I cannot ask them, I will not ask them.

Lord McIntosh of Haringey: My Lords, paragraph 6.122 of the Companion states:
	"Only the mover of an amendment or the Lord in charge of the bill"—
	that is, the noble Baroness, Lady Blatch—
	"speaks after the minister on report except for short questions of elucidation to the minister or where the minister speaks early to assist the House in debate".
	My understanding was that short questions could be asked by anybody but that they should be asked before the Minister sits down. However, I am sure that my noble friend Lady Ashton will answer two short questions for elucidation on this occasion.

Baroness Blatch: My Lords, I have no intention of asking the questions if that is outside the Standing Orders. I ask for the advice of the Clerk about whether I am allowed to ask questions in light of what the noble Baroness said on my amendments.

Lord McIntosh of Haringey: My Lords, the advice comes from the Clerk through me. I have read out the rules. I am sure that my noble friend the Minister will answer two short questions for elucidation.

Lord Carlisle of Bucklow: My Lords, does the Minister agree that what he said indicated that my noble friend Lady Blatch would be in order if she asked questions to clarify what the Minister had said?

Lord McIntosh of Haringey: My Lords, I have just said that. I have just said that it would have been better if the questions had been asked before the Minister had sat down but that, in these circumstances, if there is any misunderstanding or possibility of misunderstanding, I am sure that the Minister will answer two short questions for elucidation.

Baroness Blatch: My Lords, I was looking for the statement that my questions were in order. My questions were not relevant questions before the Minister had responded to the amendment; they arose from what she said. My understanding is that I am in order. If I am in order, I shall ask my questions.
	The noble Baroness said that the procedure that would be put in place would suffice. My question on procedure is: what will the procedure be, and what will the authority be, for the criteria? My other question relates to the figures of 30 per cent for secondary schools and 60 per cent for primary schools. Are there to be percentages? The Minister said in her response that we were getting away from percentages.

Baroness Ashton of Upholland: My Lords, I shall take the second question first. I was trying to convey a shared desire with the noble Baroness that we did not have percentages. I believe that she made that point in Committee with great force and I listened to her with great care. She said that we would somehow be saying that once one hits the barrier of 10 per cent in that context, if one happens to be the school to which the 11 per cent figure applies, one would not be able to receive earned autonomy. That is where the noble Baroness's original problem lay in this regard. I agree with her in saying that this is not about percentages. On Report, when I referred to the figures of 30 per cent and 60 per cent plus, I sought to indicate how far we have moved in our thinking and that those were the right kinds of numbers. I am not saying that when we hit 30 per cent, that is the cut-off point. We are saying that when looking at the criteria that we have put together, which we have said are appropriate, we believe that there will be about 30 per cent of secondary schools and 60 per cent of primary schools which will, within that fifth wave, have that applied to them. The figure may be 32, 29 or 64 per cent; we were seeking to demonstrate how far we had moved and to address the specific point that the noble Baroness raised in Committee. I hope that that is clear.
	The position on the procedure is that that is done through negative resolution.

Baroness Blatch: My Lords, I am grateful for the clear answer about the use of negative resolution. I do not see that as satisfactory for the House because it will not have a proper opportunity to consider the detail of the criteria.
	Secondly, I hope that I can be forgiven for the confusion about percentages. The noble Baroness's own words were:
	"Under the criteria that we propose, we expect that 30 per cent of secondary schools and 60 per cent of primary schools will qualify".—[Official Report, 17/6/02; col. 533.]
	In her answer to me, she said that we wanted to get away from percentages. I was trying to ascertain from the Minister whether that was a new move, that percentages will not feature as the target and that the schools that qualify will qualify under the criteria. That is why we would like to see the criteria. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 11 [Powers of governing bodies to form or invest in companies to provide services etc.]:

Lord McIntosh of Haringey: moved Amendment No. 6:
	Page 8, line 8, leave out from second "company" to end of line 9 and insert "registered under the Companies Act 1985 (c. 6) as a company limited by shares or a company limited by guarantee"

Lord McIntosh of Haringey: My Lords, we had full discussions on what are now Clauses 11, 12 and 13 in Committee and at Report. As a result of that useful debate, we have, as we promised, brought forward amendments which, I hope, deal with some of the concerns that were expressed.
	Amendment No. 6 places on the face of the Bill a requirement that we originally intended to include in regulations; namely, that school companies will be required to register under the Companies Act as companies limited either by shares or by guarantee. We believe, on reflection, that that requirement is better stated on the face of the Bill to provide greater clarity. That responds to concerns that several noble Lords expressed, notably the noble Baroness, Lady Sharp. We believe that different types of company activity may be better suited to different company structures. For example, we would envisage purchasing companies being limited by guarantee, with service delivery companies more likely to be limited by shares. With service delivery companies, outside partners—I refer to the restricted definition in the Bill—might be brought in. However, we do not want to impose that on companies, so we have decided to give companies the freedom to decide which company structure to adopt, while ensuring that they must have limited liability status.
	It is important to mention that both shares and guarantee offer limited liability status, giving companies financial protection. The size of the guarantee or the value of the shares issued will be for companies to decide, but in both cases the amount could be as little as £10. The financial liability that a governing body would have for the debt would be limited to that amount.
	I reiterate the assurance I gave on Report that being limited by shares cannot invite hostile takeover; shares will be sold only if the members of a company agree. The companies will remain private companies and shares will not be publicly available. Amendments Nos. 8 and 9 are purely technical. They tighten up the requirements for companies to operate only in accordance with the requirements set out in regulations.
	Amendment No. 10 places on the face of the Bill the requirement that only those specified in regulations may join companies. That was to be contained in regulations, but again we are placing that safeguard "upfront" to give a more visible degree of protection to companies and reassurance to those who were concerned. I am sure we all agree that the list of those allowed to join companies must remain in regulations. The list may need to be updated from time to time based on feedback from schools using these powers. Such amendment would have to be done by amending regulations rather than by primary legislation. I beg to move.

Baroness Blatch: My Lords, I have read and re-read the amendments and find it difficult to distinguish between "has ceased to satisfy" and "fails to satisfy", and between "any applicable requirements of regulations under subsection (3)" and "the requirements set out in subsection (3)". The notion that this is tightening up fails to convince me. I do not understand the amendments. However, I shall not oppose them. If the Minister says that this is tightening up—he clearly has had a good briefing to that effect—I have to accept that.
	I have two questions. First, paragraph 8, which has been amended by the Minister, refers to "voluntary school". I assume—I do not know— that "voluntary school" subsumes "voluntary aided" and "voluntary controlled" in the interpretation of what is a main school. Secondly, I am not sure whether Amendment No. 10 was tabled because of my reference at a previous stage to undesirable characters who will see schools as an easy target to become involved in commercial activities. I gave the example of someone who was, indeed, undesirable. Had the school been unwise enough to engage in any kind of commercial activity with that person, it would have ended in tears.
	I find it difficult to begin to understand how one describes the kind of person to whom we refer. By nature, confidence tricksters are manipulative, convincing and easy to be taken in by. How can a set of regulations specify such undesirable or unsuitable people for the purposes of becoming a member of a company? Perhaps in his reply the Minister can give examples of how the kind of person referred to in Amendment No. 10 will be described.

Baroness Sharp of Guildford: My Lords, I intervene briefly to thank the Minister. Amendment No. 6 answers queries I raised on Report concerning the identity of companies and in particular whether they would be limited by shares or guarantee. I am grateful to the Minister for tabling the amendment.

Lord McIntosh of Haringey: My Lords, the noble Baroness, Lady Blatch, raised two points. First, she asked whether "voluntary" covers both "voluntary maintained" and "voluntary aided"; it does. Secondly, she raised the question of how to keep out undesirable characters. The noble Baroness gave examples of that at an earlier stage. There are two lines of protection here. First, there is the good sense of the schools concerned. We are talking about people from more than one school, so such a person could not be the friend of one of the governors or a friend of the head teacher of one of the schools unless the other schools involved in the company were convinced of the integrity of that friend. I do not know whether the noble Baroness reads the High Principals column in Private Eye. Some of the things which have occurred in our further education colleges would lend support to what she says.
	However, we have the protection that more than one school will be involved and there will be an independent eye cast over any invitation to join. It is for the reason put forward by the noble Baroness that we are leaving the definition of "acceptable members of a company" to regulations. Clearly, that will improve with experience. We can state in regulations that the person who becomes a member of a company shall have educational objectives; or that such a person has something to contribute to the company educationally which cannot otherwise be found. We can say all sorts of things of that kind but there will always be crooks.
	Regulations will not be able to identify individuals who should be excluded. In the end, it is for us to indicate the type of person who might be included to the benefit of the operations of the company. It will be for the members of the company, the schools, to exercise their judgment, with the help of the local education authority as initial approver and supervisory authority, to ensure that undesirables do not come into the companies. That should accord with the experience of the noble Baroness, which she described on Report, of a company being formed by an individual school.

On Question, amendment agreed to.

Baroness Blatch: moved Amendment No. 7:
	Leave out Clause 11.

Baroness Blatch: My Lords, in moving Amendment No. 7, I shall speak also to Amendments Nos. 11 and 12. The Minister will be aware that I have serious reservations about schools becoming companies. I do not refer to schools being given the freedom to be more commercial but to the way in which the Government have set about this and the way that the provisions for such commercial activity are set out in the Bill and supporting policy papers.
	In his helpful and detailed letter to me, the noble Lord offered a number of explanations. However, perhaps I may refer to a comment made by him in responding to the previous amendment. He referred to some of the incredible things which have occurred in further education colleges. I have to add that the Government took a long time to shine a light on such matters. In many cases, action was taken late in the day. The Government's own record is less than perfect when we consider their dealings with Capita. That company made a mess of Individual Learning Accounts and is still being investigated, yet has been given more work by the Government. It is even involved in the work of the Criminal Records Bureau, dealing with highly sensitive information and large sums of money. The Government's own record in that respect is not good.
	In response to Amendment No. 10, which is relevant, the noble Lord said—not happily but glibly—that there will always be crooks. We know that there will always be crooks. However, we should be in the business of protecting our governors of schools. They are there not to be company chairmen, company members, or board members, but to ensure that good education takes place in schools and that schools are managed well in the interests of the education of the children within them.
	When it comes to deciding who is a desirable or an undesirable person—or, indeed, a suitable or an unsuitable person—to become involved with the running of a company, the noble Lord said that help would always be available from the LEA, which is the supervisory body. However, we have been told that the latter will be very "light touch". It will be possible to carry out such duties under the law relating to these clauses—and, indeed, company law—only if the supervisory body actually knows what is going on. You cannot know what is going on without having a good deal of day-to-day information. The notion that this will not be extra-burdensome to LEAs simply is not true.
	Moreover, should any of these companies go belly up, the LEA will have to pick up the tab. Thus LEAs would be well advised not to be too light a touch when complying with their duties and putting matters right. However, they should not do so when something goes wrong, as set out in the noble Lord's letter: well before something goes wrong, they should ensure that such matters are being properly managed. The letter says that the LEA,
	"will only step in when it is clear that the company is running into trouble".
	That is too late, especially when there have been visible signs that the company was running into trouble.
	I shall leave the question of Clause 13 to one side for the moment. I believe that the costs of establishing all the measures outlined in Clauses 11 and 12 will outweigh the benefits that the noble Lord has claimed will be there for the purposes of "acting jointly", "purchasing jointly", and so on. We have argued on a number of occasions that joint purchasing is a longstanding practice of both LEAs and of schools. The notion that contractors cannot deal with a single body that represents a number of schools is simply not true. For example, one school says, "We'll put the order in", while the other schools will decide between them what they require. The order will be delivered, and the payments made to the company. If it were a problem, contractors would not be touting for business around the schools and saying, "If you order in reasonable quantities, we can give you discounted prices". It is an age-old practice, which still continues; and, indeed, it will continue to do so. I believe that the problems outlined by the noble Lord are exaggerated.
	On the question of company members, the noble Lord agreed with the points that we raised regarding protection for schools as regards allowing undesirable people to become involved. We now know that there is an amendment to that effect which goes some way to protecting company members. However, describing "unsuitable people" ahead of them turning out to be so, is something that I regard as being a real challenge. The noble Lord says in his letter that the Government will consult upon those who will be allowed to join companies. But who will be consulted? Further, in what way will it be possible to do so?
	In his letter, the noble Lord refers to the exercise of LEA functions,
	"to make arrangements for the provision of services for schools for other persons".
	Can the noble Lord explain what is meant by the words,
	"times;for schools for other persons"?
	I believe that they can provide services for other schools and for other persons. If there are to be "other persons", can the Minister say who are these third bodies who are not other schools? For example, would schools provide catering for the local playgroup, or would they provide cleaning services for a local private company down the road? What is the definition of "other persons", if they are not to be other educational establishments?
	The noble Lord continued in his letter to cover the distribution of profit. I have to tell the noble Lord that not only Members of this House but also his colleagues in another place will be most interested in his response on the distribution of profit:
	"Our regulations will prescribe that school companies may pay company profit back to the members, or retain it to invest in developing the capacity of the company. We do not propose that profit must be spent solely in the interests of education".
	If it is not to be spent solely in the interests of education, are we to assume that governors can indulge in forming a company and making profits and that those profits are not expected—indeed, not just expected but required under this Bill—to be spent in the interests of education?
	I know that the noble Lord will say that there will be third party members of these companies—joint members of the companies—who will not be educationists: they will be purely third-party commercial interests. Therefore, do we expect that there will be a constraint on those who are members of governing bodies in an expectation that their profits will go back into schools? I do not refer to a "requirement", because the Bill does not specify that; there is no requirement in the legislation to spend this money on education. However, do we expect that to happen, while the profit made by the wholly-independent commercial member of the company can be used for rewarding shareholders, or spent on whatever the chairman chooses?
	There are a number of questions to be answered. I have in mind private companies making a profit in a safe haven. Some commercial people will regard a school as a safe haven within which to do business, in the full knowledge that if the company fails the LEA will pick up the tab. Alternatively, if the company succeeds, it will go away with a pocket full of money.
	I turn to Clause 13. I shall not press my opposition to Clause 13. I want to take in good faith the fact that a great deal of work has been carried out by the Church and by the Government. I have enormous reservations about whether or not this will work. However, I should like to give this the benefit of the doubt because I believe that the work that has been carried out at national level between the Government and the joint venture members of the company to date is such that I should not wish to stand in its way. Nevertheless, I have some very real reservations that I should like to put on the record because there may well be difficulties in the future.
	The right reverend Prelate, who has also very kindly written to me, as promised, with a very detailed letter, referred to the PFI not working. I have to point out that PFI projects have been as small as building small fire stations and setting up small Probation Service projects. Therefore, the notion that such initiatives do not work at a local level and on small projects is simply not true; indeed, such initiatives have worked and, in some cases, they have worked very well. There have also been examples of more than one project being dealt with at any given time so that, taken together, they have formed a much bigger project.
	The noble Lord prayed in aid of his case the fact that for the year 2003–04 the department allocated £940 million PFI credit to 21 projects. However, only £10 to £20 million went to voluntary aided schools. If I were in the place of the right reverend Prelate, I should want to challenge those figures. As the right reverend Prelate knows, 10 per cent of the schools are voluntary aided schools. Therefore, in my book, 10 per cent of £940 million is £94 million, which is a good deal more than the £10 to £20 million that has been allocated. I am not sure that I can accept the idea that, because it is an unfair allocation, we have an argument for going down this road.
	In his letter, the right reverend Prelate says:
	"All three bodies"—
	that is, the three bodies that are part of the joint venture company—
	"will provide the funding".
	I thought that this was being introduced because the Church, the LEA and the Government did not have the funding. If the funding is to be provided under the new arrangements, what is wrong with such funding being provided now? The letter continues:
	"The JVCo [the joint venture company] will engage the necessary legal and technical advisers to carry out the procurement on behalf of the schools and dioceses and, with their inputs, appoint a Private Sector Partner (or Partners) who will provide the design, building, [and] finance".
	So we have finance being provided by the private sector partners, and we have funding being provided by the Government, the Church and any other party to the joint venture company; but at what cost? Where will that money come from? What pot of money will it come from?
	The letter continues:
	"Furthermore as new tranches are ready to come on-line, there are potentially no bidding costs for the Private Sector Partner".
	Am I to take it that competitive tendering has gone out of the window for these purposes? Some preferred bidder—some lucky chap out there who is running a company—is about to get the business for something like £40 million worth of work, which, we have been told, is the likely first tranche of spending. We are told that future contracts will simply keep going for that one contractor. Is there to be no process of competitive tendering for the business? For example, will other companies that provide such services be allowed to bid? If there is to be no bidding costs, I assume that there will be no bidding. The right reverend Prelate goes on to say that that would be a great saving to the public sector.
	The next point concerns profits. It is not intended at this stage that the schools would be members of the joint venture company. If I was successful in removing Clauses 11 and 12, that would be the case; the joint venture company, at least in the initial stages, would be at one at national level with the Churches involved. As I say, I intend to leave that in the Bill.
	The letter goes on to say that schools would be party to the procurement and would also gain a small share of the profits. Am I to understand that money will come from government, Church and other partners; schools will be repaired, refurbished and even newly built; that the company will make a profit (out of what, I ask); and when it makes a profit there is nothing in the Bill to say what will happen to those profits? Will the Church take them? Will the Government take them? Will the commercial partner take them? I thought the profits would go to the company doing the refurbishment work and building the schools.
	My final point is on the final paragraph:
	"The details of the joint venture companies are still in development, but it is thought likely that individual schools will pay the Private Sector Partner directly over the years of the contract with the benefit of DfES grant over the period and the proper level of local education authority contribution (for their liabilities), the governing body being responsible for the 10%".
	So it is not a free option. The LEA will have to pay; the Government are going to have to pay; the Church will have to pay. But they all pay now for projects. So what is the beneficial factor in this option? I do not know.
	As I said, despite my reservations which are now on the record, I want to give the right reverend Prelate and his colleagues who are making this case the benefit of the doubt and therefore I shall not oppose Clause 13. However, I intend to oppose Clauses 11 and 12. I beg to move.

Lord Carter: My Lords, the Companion clearly states:
	"The principal purposes of amendments on Third Reading are: to clarify any remaining uncertainties; to improve the drafting; and to enable the government to fulfil undertakings given at earlier stages of the bill".
	Can the noble Baroness explain how amendments which remove a whole chapter from the Bill—in effect, wrecking amendments—fit the guidance in the Companion? I am sure that the noble Baroness will say that since she tabled the amendments and they were not rejected by the Public Bill Office they must be in order. But if the Opposition Front Bench and the Liberal Democrat Front Bench combine to table amendments which are completely outwith the guidance in the Companion, how are we supposed to take any notice at all of the Companion?

Baroness Blatch: My Lords, if I am out of order I will be advised and I will remove them.

Lord Carter: My Lords, the noble Baroness is not out of order because she has been allowed to table the amendments. I am asking how she feels her amendments, which remove a whole chapter from the Bill, fit the guidance in the Companion.

Baroness Blatch: My Lords, if I am in order, then I am in order. I have spoken to my amendments. I beg to move.

Lord Peston: My Lords, that is simply not acceptable. I have been sitting here, as has my noble friend Lord Carter, wondering why we bother to have the Companion. This does not apply only to these amendments; it applies also to others. For the years when I sat on the Benches opposite, I and my noble friends stuck religiously—if I may use that word standing just behind the right reverend Prelate—to the spirit of the Companion.
	I am with my noble friend Lord Carter. I should like an explanation because we are not even discussing misbehaviour on the part of Back-Benchers; we are discussing what the Opposition Front Benchers are doing. This may be a new departure but the notion that one is in order is not the same as meeting the courtesies—a large part of them are courtesies—of the Companion. My noble friend Lord Carter is entitled to a reasoned reply to the question he put perfectly reasonably.

Baroness Blatch: My Lords, I shall be repetitive. I took advice. I believe I am in order. If I am out of order, I will be advised and will respect the advice I am given.
	Secondly, I have been entirely consistent throughout this Bill, from the first day, with my concerns about these clauses. We go through a Bill at each of the stages, both reflecting on what we have said and Ministers reflecting on what they have said. We had an interesting process of letters. As I say, if I am out of order I shall withdraw my amendment; if I am within order, I beg to move.

Baroness Sharp of Guildford: My Lords, my name and that of my noble friend Lady Walmsley is attached to this amendment. We have had no indication from the Clerks that it is out of order and we must therefore proceed as planned.
	We have had much discussion in Committee and on Report on these clauses. My name is attached to Amendments Nos. 7 and 11, which apply to Clauses 11 and 12 but not to Clause 13. We learn, as a result of our extensive discussions, that in fact the powers to form companies, as Chapter 3 says, are limited powers; it only applies to two or more schools who wish jointly to form a company to do things together. The governing bodies of schools, already as bodies corporate, have the power to form a company for an individual school. The problem is that they cannot form companies with two or more schools to undertake joint purchasing or the provision of joint services. That is what the two clauses involve.
	So this is a misleading title, both to the chapter as a whole and to Clause 11, which says,
	"Powers of governing bodies to form or invest in companies".
	The power is to form and invest in joint companies.
	We from these Benches have also opposed these clauses from the start. Although I have learnt more about what the companies are supposed to be about and why the Government wish to set them up, we have not changed our view that on the whole we do not wish to see these two clauses in the Bill.
	Why is that so? There are four main reasons. The first is that we feel it sends out the wrong message. On the whole, from these Benches, we do not feel that the heads of schools, teachers and governors should be getting involved in companies on behalf of schools. Schools are not companies; they are community institutions. Given all the other pressures on their time, teachers, governors and head teachers should be concerned with running their schools and not running companies. So we feel that the clause sends out the wrong message.
	Secondly, we are worried about the implications of these clauses for the local education authorities. We have received all kinds of assurances from the Minister about the role of local education authorities. Yes, it is a light touch supervisory role. But they end up having to bail out or pick up the tab if anything should go very wrong.
	I worry also whether local education authorities have the competence to act as supervisory authorities for setting up companies. By and large local education authorities do not employ accountants and lawyers who have a lot of knowledge about setting up companies. Again, they are hard pressed to do the job they have to do in terms of running the schools in their local area; they do not want to have to spend time looking at the details of companies that schools are setting up and making sure that they are not doing the things they should not be doing.
	So again we feel that this is not something we want our local education authorities to spend time doing. Nor do we feel it is right that money taken from local taxpayers to help pay the costs of schools should be put at risk perhaps by nefarious doings on the part of some governing bodies.
	The third argument relates to the degree with which we feel there is justification for setting up the companies. Can the Government really justify a case for setting up the companies? Their answer is that they want schools to purchase jointly. As the noble Baroness, Lady Blatch, pointed out, many schools have come together to purchase jointly for many years. LEAs were set up in part to reap the economies of scale of joint purchasing and we believe that that can still be achieved. As regards the provision of joint services, we spoke a great deal about the possibility of the development of software; that is, having two teachers from different schools developing software and perhaps deciding to form a company. We argued that they may not want to set up a company for themselves because they may want the profits to go back into the schools, but the company could be limited by guarantee. The answers to those arguments do not hold true.
	The Minister also said in Committee:
	"As regards the examples given of schools combining to purchase jointly without this power [to form joint companies], that is perhaps a possibility".—[Official Report, 17/6/02; col. 559.]
	But what about those from whom they are purchasing? Surely they will want to have someone against whom there is some comeback. We have already observed that the local education authorities have to pick up the tab if things go wrong. I repeat that schools have been purchasing, and purchasing jointly, for many a long year. Quite frankly, there is no need to have such comeback; there is no need to form a company. As regards all these issues, the argument does not ring true; there is no real justification for the provision.
	Finally, we have doubts about precisely why the Government want to set up these companies. Is there perhaps some subtext? One aspect is the new contracting-out order procedure which we approved in March this year; it is the assumption that LEAs will be able to persuade schools to form companies to take on and deliver the services which LEAs no longer feel competent to provide. We have discussed at length purchasing and providing, but I ask your Lordships to look at Clause 11(1) regarding the power to form companies. Paragraph (a) of that subsection relates to companies being formed:
	"to provide services or facilities for any schools".
	Paragraph (b) reads:
	"to exercise relevant local education authority functions".
	Paragraph (c) reads:
	"to make, or facilitate the making of, arrangements under which facilities or services are provided for any schools by other persons".
	What are the local authority functions? We are most perplexed. Is there an unwritten text? Are the Government looking for a route to semi-privatisation? We on these Benches would oppose that. We do not want to see the privatisation of education. We do not understand that subsection and believe that it may contain a subtext. We had doubts as to what it was all about.
	I return to our fundamental objections. Schools, teachers and governors should be concentrating on running schools, not running companies. The proposition is misguided and we believe that it should be removed from the face of the Bill.

The Lord Bishop of Blackburn: My Lords, I must intervene to express my gratitude to the noble Baroness, Lady Blatch, for saying that she will not press Amendment No. 12. However, I could wish that she had replied to my letter, which other noble Lords have not seen. It might have been helpful for them to have seen it before we had a debate about its contents. As the noble Baroness well knows, I do not have back-up in the House and these are highly technical questions in relation to companies which I cannot answer. However, I am grateful to her for putting forward some of the concerns, but I have to admit to the House that I am not in a position to answer the specific points the noble Baroness made. Sometimes fact is more strange than fiction and to have the Conservative Opposition's lead speaker on the Bill opposing the establishment of companies and a diocesan Bishop speaking up for them is an extraordinary set of events.
	I listened carefully to other parts of the debate and I do not want particularly to become involved in them. However, I heard what was said about LEAs by the noble Baroness, Lady Sharp, and I have concerns about that. I am not worried about the public/private partnership. I believe that that might be a way forward for some schools. However, are we not dealing with secondary education in the Bill? The White Paper was about secondary education.
	I am a little troubled that we are preventing responsible governors of secondary schools from taking actions, using illustrations from higher and further education. It seems that the governors of other institutions within the public sector—and certainly the governors of independent schools—are able to do that. I may be wrong about that, but, having noted the cautions, I would want to be supportive of the enabling power. I have greater trust in the governing bodies I come across.
	There are bound to be failures—there are failures in almost any walk of life—and risks have to be taken. However, I thank the noble Baroness, Lady Blatch, for saying that she will not press her amendment. If she did so, that would cause great difficulties for us. My advice is that the provision is a way forward to help smaller schools with projects and I trust the advice I have been given.

Lord McIntosh of Haringey: My Lords, without raising questions of procedure or of what is or is not in order—it is not my job from this Dispatch Box—I am a little surprised by the way in which the amendments come before us. In the nearly 20 years I have been in this House I have been used to the difference between Committee, Report and Third Reading. Generally speaking, in Committee we explore the areas of potential difficulty with the Bill. Each clause must positively stand part of the Bill and the debate on clause stand part is used to explore the Government's justification for any aspect of a clause. It is often difficult for Ministers to respond to that, but they must do so—it is the nature of the job.
	In Opposition, one tries to refine one's objections and to pick out the points which remain objectionable after they have been explained. At Third Reading, if difficulties arise out of that debate, one tries to deal with those particular points. However, we find ourselves debating amendments, which have been accepted by the Public Bill Office, removing the whole of the clause. That is what I must respond to.
	I do not believe that the noble Baroness, Lady Blatch, has and would argue that Ministers have not responded to her in great detail on the points she has raised both in speeches in the House and in detailed letters. I believe that we have addressed—I would say answered—all the points she has made so far. The question must be turned around. The noble Baroness, Lady Sharp, objects to the proposal because she believes that it is unnecessary and will not take place. I shall later deal with her point that this is perhaps some subtle plot to introduce semi-privatisation and to persuade schools to have that. I shall put that on one side for the moment.
	Surely, in considering these amendments, our starting point must be the proposals which are purely voluntary. We must ask: on what basis is it the wish of anyone in Opposition parties to deny those schools—it may be a few—which have expressed a need for such facilities and which want to use them the right to take advantage of them? That must be the starting point, not the other way around.
	Some schools are already forming companies on their own. The noble Baroness, Lady Blatch, gave examples. They have not found it too big a burden, so why should we prevent schools from joining together and thereby reducing the burden of forming companies? We have not plucked this policy out of the air—it is not blue-skies thinking in the Department for Education and Skills. It is a response to those who have come to us and indicated that they want to work together in new ways. They are confident, creative schools which want to work together in new ways to raise standards in their own schools and in others.
	I repeat what I have said at each stage: the decision is entirely voluntary. I say to the noble Baroness, Lady Sharp, that they will not be forced or persuaded to form companies. They will do so only if it is for their benefit and only if, in their view—it is their view that matters—they will not be interfering with what I agree with the noble Baroness, Lady Sharp, is their main task: providing education for the pupils in their schools. Those companies are not an end in themselves; they are simply the best mechanism available to facilitate joint activity.
	There are limits. A few minutes ago, I said, perhaps too broadly, that those companies are designed only for more than one school acting together. That is not quite accurate. They could be formed by a single school that wanted to provide services for other schools as well. That is presently not possible and will be made possible by this chapter. But the main users, I suspect, will be schools joining together, first, to reduce their administrative and purchasing burden. The noble Baroness, Lady Blatch, misunderstood that when she queried the phrase, "other persons". She thought that that referred to providing services for other persons. It does not. It refers to providing services for schools and only for schools by other persons. If she reads the Bill, she will see that that is right.
	The second reason for using such companies is that schools may want to join together to deliver services to other schools in which they have real strength. That could result in benefits to company members and to other schools, which could receive good quality support. Let me give an example. Schools may have an educational idea but lack the distance learning or publishing skills appropriate to enable it to be made more generally available. They may therefore need to bring in outside organisations—perhaps a not-for-profit organisation, an educational institution in the field of further or higher education or a commercial publisher or distance learning skill provider. They may bring in such people as members of the company on the basis that they will take a share of the profits. And why not?
	I cannot reconcile the opposition to that idea with what I understand to be the ethos of the Conservative Party. It simply does not make sense to me. If I can understand the ethos of the Liberal Democrats, their opposition does not make sense to me either. There could be real benefit to the quality of services offered to other schools through such companies by joining together private and voluntary partners with schools.
	Let me make it clear that when talking about profits there is no question of governing bodies taking their share of the profits to use for anything other than the educational needs of their schools. There is no possibility of siphoning off profits, as has been suggested.
	I turn to the issue of local education authorities. Again, there is an element of suspicion that is not justified by what the Bill provides. If and when such companies are set up, they will operate in a positive, productive partnership with their local education authority. They will have to, because local education authorities will give the go-ahead for their formation and will act as the supervisory authority thereafter. School companies will operate within a protective regime, correcting the balance between giving companies freedom to govern themselves—of course, there are some dangers, although the noble Baroness, Lady Blatch, overstated the case—to innovate and to use the fruits of that innovation for the benefit of education more generally. Much of that provision will be contained in regulations under Clause 12 and we shall listen carefully to the views expressed on that.
	I am glad to hear that opposition to Clause 13 will not be pressed because the speech of the noble Baroness, Lady Blatch, contained a number of new misunderstandings. First, I can assure her that there are no changes to the tendering rules. There will be savings in bidders' costs, but they will be entirely passed on to the schools for the benefit of education and will not go outside. The amendment to leave out Clause 13 may not be pressed, but Clauses 11, 12 and 13 form a package. They enable individual schools to join in joint-venture companies to benefit from the good quality advice and support that they will acquire for use in private finance initiative schemes, if such schemes are appropriate as, for example, in the case of the proposed Church of England company.
	The opposition to the clause is paradoxical. If it had been advanced by those who are opposed to entrepreneurial activity, innovation and the dissemination of good practice and new ideas, I should have understood it and handled it. But to have such opposition advanced at this stage by the party of capitalism and by the party of liberalism strikes me as strange. I hope that the amendments will not be pressed.

Baroness Blatch: My Lords, I am sorry that the noble Lord is in a state of confusion over the matter. Let me make it clear: I am for innovation and the clauses on earned autonomy. In fact, we have tabled amendments to allow more schools rather than fewer to enjoy that. I am in favour of good practice, but therein lies the rub. The provision is not good practice; it is not thought through; and we have not received good answers about culpability, liability and protection of governors. How on earth will the extra time, money and effort be spent without any impact on the primary duty of a governing body, which is to manage its school?
	I can only go by the words on the page. The letter that I cited from the noble Lord states "no bidding costs", not "lower bidding costs". So I was left with the impression that either someone else would pay them or that there would be no bidding. On profit, let me read from the noble Lord's letter, rather than refer to the words that he just used. The letter states:
	"Our regulations will prescribe that school companies may pay company profit back to the members, or retain it to invest in developing the capacity of the company. We do not propose that profit must be spent solely in the interests of education".
	I rest my case on that point.
	When the noble Lord described third parties, what he said was not consistent with the Bill. Third parties have been described variously as third parties with an interest in educational matters and third parties that are purely commercial but which would join schools to form companies to make profits, some of which may find their way back into schools. But today every example of a third party to which the noble Lord referred had a specific link with education: further education authorities; educational publishers; and the like. While not excluding them, does that mean that any third party must be one with a link with education?
	Difficulties remain. A bit of a campaign is going on today about procedure, but my concerns about the clauses remain. We have passed each stage of the Bill hoping that many of our points would be taken on board; but they have not. Here we are at the final stage of the Bill and I believe that I am procedurally within my right to refer to those concerns at this stage and, if I wish, to press the amendments to a vote.
	We live at a time when there is a shortage of teachers and, in particular, a shortage of teachers teaching the subjects for which they are trained. The Government hold unprecedented sums of money centrally, denying schools the full benefit of core funding. Innumerable new burdens have been imposed on governors. Many of our schools, as yet unspecified, are the sort of school that the Secretary of State would not touch with a bargepole.
	The Bill creates further pressure on schools to form companies. Having three layers of management—the schools themselves and the companies, the local education authorities and the Secretary of State—is a recipe for chaos. We are not preventing schools from joining together to save money. We are not preventing them from behaving commercially. They already do so successfully, and we hope that they will continue to do so. The right reverend Prelate asked why, if independent schools could do it, individual schools could not. Individual schools can.
	This is not a secondary education Bill: would that it were. The Government talk about changes to secondary education, but there is hardly anything in the Bill that spells out the detail of reform to secondary education. I believe that colleagues on the Liberal Democrat Benches join me in this view only: we should protect our schools and the education of our children.

On Question, Whether the said amendment (No. 7) shall be agreed to?
	Their Lordships divided: Contents, 183; Not-Contents, 141.

Resolved in the affirmative, and amendment agreed to accordingly.
	Clause 12 [Limits on powers conferred by section 11]:
	[Amendments Nos. 8 to 10 not moved.]

Baroness Blatch: moved Amendment No. 11:
	Leave out Clause 12.
	On Question, amendment agreed to.
	Clause 13 [General powers of Secretary of State in relation to companies]:
	[Amendment No. 12 not moved.]

Baroness Blatch: moved Amendment No. 13:
	Before Clause 19, insert the following new clause—
	"CONTROL OF REGULATION
	(1) In relation to the conduct of education in schools and nursery schools, the Secretary of State and local education authorities shall have a duty to limit new regulation and to control the amount of material they send to governing bodies and head teachers.
	(2) The Secretary of State must publish an annual report to Parliament, setting out any progress he has made in the preceding year in seeking to control or reduce the volume of regulations, circulars and codes of practice that he or his predecessors have published, and reporting any representations he has received from governing bodies, head teachers or teachers' representative bodies about the burden that regulations impose.
	(3) Each set of regulations, circular or code of practice issued by the Secretary of State shall include a statement by him of the time he expects it will take for governing bodies or head teachers of schools or nursery schools, as appropriate, to read, consider and implement the regulation, circular or code of practice concerned.
	(4) In making his estimate under subsection (3), the Secretary of State shall impose no additional burden on schools or nursery schools to provide him or local authorities with information."

Baroness Blatch: My Lords, I rise to address the most vexed issue of the day so far as schools are concerned. In an interview for the Evening Standard on 3rd October 1996, the then shadow Education Secretary, David Blunkett, stated:
	"We will increase delegation to schools and cut down on town hall bureaucracy".
	Only now are the Government talking about cutting down bureaucracy after five years of massively increasing it. While we are discussing a Bill that will generate an unprecedented amount of bureaucracy, regulations, circulars, guidance and so forth, we are also still discussing a reduction in the burden of paperwork.
	Over the 12 months to March 2002, the Government issued to primary and secondary schools documents totalling 4,440 pages. That represents 17 pages of government documentation for every single working day. That information came from a parliamentary Answer from the Government. A recent report published by the National Union of Teachers found that 57.8 per cent of teachers leaving the profession cited workload as one of the most important reasons for their departure. Despite that, the Secretary of State, Estelle Morris, claimed recently that reducing paperwork would not help teachers. She stated:
	"I say to the House and to head teachers that sending teachers less paper will [not] raise standards".—[Official Report, Commons, 10/1/02; col. 661.]
	It is my contention that sending schools less paper would give them more time to do what they should be doing; that is, running the schools and teaching the children. I beg to move.

Baroness Sharp of Guildford: My Lords, noble Lords on these Benches very much support the spirit of this amendment. The Government have set new records for the quantity of paper that has been spewing forth from Sanctuary Buildings. The advice being given often goes into extremely fine detail covering many pages. One has only to look at the number of books and amount of detail issued in connection with the numeracy strategy. These days, central government lay down week by week what mathematics should be taught in the classroom.
	We see this as part of the centralisation agenda which started not with this Government, but long before, back in the 1980s under the administration of the noble Baroness, Lady Thatcher, who I see is in her place. We have all suffered from the increased centralisation and bureaucracy that has beset our schools. We need a bonfire of regulations. However, I do not think that this is the right amendment to achieve it. My doubts relate in particular to subsection (3) of the proposed new clause. It suggests that, when sending out any circular and so forth, the Secretary of State should indicate the time that it will take to fill out the forms or deal with the information. The amendment states that the,
	"Secretary of State shall include a statement by him of the time he expects it will take for governing bodies or head teachers of schools or nursery schools, as appropriate, to read, consider and implement the regulation, circular or code of practice concerned".
	Even if we take only the word "read", something of a problem is created. Obviously, it takes people different lengths of time to read a document because some are fast readers and some are slow. Then, when trying to work out the time involved in a board of governors considering the impact of a document, there too will be wide variation from institution to institution. It would be extremely difficult for the Secretary of State to specify times in this regard.
	Subsection (2) invites the Secretary of State simultaneously to list all the representations he receives from head teachers and governing boards concerned with bureaucracy. One can bring to mind the vast numbers of letters that will be sent stating something like, "You expected us to read this material in five minutes, but it has taken us 55 minutes to do so".
	As I said, in spirit we entirely support the proposed new clause, but in practice it is not the right way to seek to control bureaucracy. We need a bonfire of regulation, but what must be done is to go back to where we started. The problem lies in over-centralisation, a practice that was as much of a problem under previous Conservative administrations as it is under this Government.
	Education should belong to the schools and to local education authorities. We want to go back to a time when we trusted our teachers to get on with the job, when they did not have to be told bit by bit what to do; we want to trust local education authorities to run the show. We do not want even more circulars about other circulars.
	While we support the spirit of the amendment, we shall not be joining the Opposition in the Lobby.

Lord Dearing: My Lords, I recall helping a Conservative government once upon a time and being as much concerned then as I am today about the flow of paper into schools from government and local authorities. I do not believe that the amendment is an effective way of controlling it, but the intent is absolutely right. In the days when I was advising, a very senior official was appointed to control the flow of paper into schools. He did not succeed.
	Teachers enjoy teaching—they enjoy the demands of their profession—but they are not administrators. They need time to prepare their lessons and to teach, and they are not getting enough of it. I said before how astonished I was to hear from a former chief inspector, a little over a year ago, that 400,000 teachers were teaching, and 400,000 qualified teachers were not teaching. That speaks a great deal about what teachers think of their profession.
	They love teaching—they want to teach—and the greatest single service the Government can give to education is greatly to reduce the flow of paper into schools. I hope that the Minister will be able to give the House some real assurances on this issue.

Lord Monson: My Lords, I have not so far taken part in the debate but there is an enormous amount of force in what the noble Baroness, Lady Blatch, said. Would not the answer be to pass the amendment and then, in the other place, subsections (2), (3) and, by extension, subsection (4), to which the noble Baroness on the Liberal Democrat Benches objected, could be removed there? That would leave in subsection (1), which is the really important one. Unless the amendment is passed, that will be impossible.

Baroness Ashton of Upholland: My Lords, I have spoken to this issue at previous stages of the Bill and once again I wish to make clear that the Government wholeheartedly support the spirit of the amendment. We understand that head teachers and teachers are under pressure. We are only too well aware of the importance of removing unnecessary burdens from our schools. It is something at the forefront of our minds in the continual challenge, as the noble Lord, Lord Dearing, and the noble Baroness, Lady Sharp, said, to let teachers concentrate on teaching and to create the right environment for all our pupils to succeed.
	I accept that when one talks to those who should be in the teaching profession but are not, or to those who are moving out of the teaching profession, they refer to workload issues. It is very important to understand what we mean by "workload" and not simply to see it as an issue—important though it is—of the amount of paper that teachers have to deal with.
	I am sure that the concept of a school system with no regulation, no information and no guidance is not realistic. I accept that the amendment of the noble Baroness, Lady Blatch, does not propose this, but we do need to be careful. Its aim is laudable but it would have damaging and obviously unintended consequences elsewhere. If we placed what would be necessarily crude and arbitrary limits on the number of regulations, we would ignore the unforeseen needs which we all know can materialise, in some cases almost out of the blue. We do not believe that it is right to surrender our ability to act swiftly and effectively to protect the rights and needs of pupils and adults working in schools simply to comply with the provisions of the amendment. Our schools need to operate within a common framework and to understand their position within it, particularly in regard to the choices open to them and the responsibilities placed on them.
	Perhaps I may provide the House with some examples of what I mean. We need to be able to communicate with schools and education authorities in order to make them aware of new guidance material that we may issue. A case in point—one which is close to noble Lords' hearts—is Clause 173, which deals with the welfare of children and which the noble Baroness, Lady Blatch, supported. We surely would not want to put ourselves in the position of not being able to send out material on an issue of such importance because there was a limiting statutory duty to control material.
	It is not only the need to respond immediately to particular issues that would be under threat but the regular work that goes on to try to improve provision for the most vulnerable children in our society and to enhance their life chances. For example, if we decided to revise and improve the admissions framework through a new code of practice because we found that it needed improvement for the most vulnerable, we would not want to tie the Secretary of State's hands by not allowing her to consult or communicate with schools.
	I accept the point that schools do not gain from being deluged with irrelevant or poorly structured material. I emphasised at Report stage how important it is to ensure that our communications with schools are of high quality, and consistently so. But this amendment would jeopardise our ability to communicate with schools and could put us in a position of not being able to explain to schools what we were trying to do.
	The amendment has defects, too, in that it requires the Secretary of State to work out how much time each head needs to read, consider and implement any specific regulation or circular. This assumes the "one size fits all" approach to regulations to which we are precisely opposed. Guidance, regulations and codes of practice will often apply to different schools in differing degrees according to their individual circumstances, and they will spend different amounts of time in considering and implementing them. We would not want the Secretary of State to spend time trying to second guess to the minute how long schools will spend reading documents. Schools will decide that for themselves. If they believe it is too long, I trust that they will make recommendations to us and we will act accordingly.
	The amendment is lacking in that it does not address the issue of the quality of information issued. I know from my own experience of being both responsible for issuing information and being on the receiving end as a chair of governors until last year that it is the quality equally as much as the quantity—indeed, more so— of the communication or regulation that is of paramount importance.
	With this in mind, I wish to give the House an example of some of the regulations that will emanate from the Bill. On the new school governance regulations we will be "road testing" draft guidance and regulations with focus groups involving representatives from the main stakeholder groups before we formally consult. This will ensure that what is being proposed is clear and fit for purpose. We want schools to get all the information they need, but no more than is necessary, to implement the planned changes.
	The new guidance and draft regulations have already been considered by our advisory group on governance, discussed with Church representatives and piloted with focus groups of governors, local education authorities and diocesan boards in Darlington, Coventry and London. The focus groups warmly welcomed the opportunity to participate and made useful suggestions, while commending the department's general approach. In all cases, schools will get only exactly what they need for their own purposes, tailored to the category of school. This is what our approach to regulation is all about—discussing our changes with stakeholders, ensuring regulation is fit for purpose and tailored to the end user.
	As I have explained at previous stages, we take very seriously our responsibility to remove those burdens on schools which should not be there. I have referred to the range of measures which are in place, from greatly increasing the numbers of support staff in schools to the current programme of 32 pathfinder schools which is exploring new and better ways of tackling teacher workload.
	Perhaps I may explain to the House the kind of resources we are looking at for these pathfinders. We have provided additional resources, including a new laptop for every teacher, Internet access and ICT support. Noble Lords will have heard me speak many times on the issue of new technology. I believe that new technology can be absolutely fundamental in helping our teachers to reduce their workload, simply because it provides a framework in which planning and other activities which we know take teaching time can be done more effectively. It is a very useful communication tool between schools, local education authorities and the department. We want to explore very carefully ways in which we can use the technology.
	We have provided additional teaching assistance and administrative support in the pathfinder areas, including bursarial staff, to help free up teachers and school leaders to focus on professional responsibilities. We have introduced training for all staff in the use of the new ICT provision. We have increased non-contact time for teachers to free them up for lesson planning and marking, professional development and school planning activities, and we have put up to seven days the professional support time to be used in helping to deliver the changes and receiving advice on a variety of approaches to reduce teacher workload.
	The 32 pathfinder projects are there—this takes nothing away from the issue of ensuring that the department sends schools what they need and no more—because we recognise that we also need to look in a broader context at the issues of teacher workload. They do not all rest on the bureaucracy to which noble Lords have referred. It is within the context of examining the 32 pathfinder projects that we want to ensure that we get this right. We recognise the pressure in this House and elsewhere to ensure that we do this properly. That is why we have set up the pathfinder projects.
	We are not complacent about this matter. As noble Lords will be aware, the Secretary of State is considering her response to the report of the School Teachers' Review Body on teacher workload. I believe that it would be short-sighted of us to make hasty decisions about one aspect of workload pressures without thinking through the interplay with other factors which place pressures on teachers. We are engaged in thinking of ways to reduce these in conjunction with all those who have an interest in this area. Therefore, I do not want to act now, ahead of the Secretary of State's response in the autumn to the teacher workload report. I believe that to do so would be premature and possibly counter-productive.
	Our intentions are very clear. We believe in sensible regulation fit for purpose. We wish to provide essential safeguards in the education system. We are committed to providing high-quality, clear communications for schools which recognise the needs of those delivering education. We are dedicated to an approach that involves stakeholders in deciding on these issues.
	Having recognised the spirit in which the amendment has been proposed, I believe that it would not assist us in completing the work that we have started in this area. With those commitments, I hope that the noble Baroness will feel able to withdraw her amendment.

Baroness Blatch: My Lords, I believe that the amendment would assist schools and their heads and governors if there were a duty on the Secretary of State to limit regulation and to limit the flow of paper into schools to only that which is necessary or essential and which at the end of the day enhances the experience of a child in the classroom.
	There is a real world out there, and then there is the Department for Education and Skills. I have listened to everything that the Minister has said. I know that she is sincere in her belief in what she is saying. But those working in schools do not say these sorts of things. They do not say that the only documents that come through the door are those which are absolutely essential, or that the only documents they receive are those that add to and enhance the educational experience of the children.
	I am almost offended by the examples of essential information given by the Minister; namely, to do with the safety of children, to do with emergencies that crop up without notice. Of course there has to be communication between the department and the schools, but the Minister uses those examples against what I am arguing about— the unnecessary information and documentation that goes out to schools.
	In relation to subsection (3), the noble Baroness, Lady Sharp, was concerned that some view should be taken when regulations are passed down to schools about how much time is expected for a primary school or a secondary school to interpret a document and to implement whatever measures it contains. One of the problems is that regulations are passed inexorably downwards to schools, without any thought whatever about how much time needs to be expended on interpreting them, understanding the legalese and making sure that they are implemented—knowing that down the road will come Ofsted to inspect schools to see whether they have carried out the requirements. So I believe that subsection (3) is important.
	Nevertheless, I take the point made by the noble Lord, Lord Monson. If the Government believe that the thrust of the amendment is right, and if my Liberal Democrat colleagues believe that it is right and really do have sympathy with schools because they are inundated with bureaucracy, let them support this amendment. Let the Government make sense of the duty that I wish to place on the Secretary of State to limit and control the flow of paper and regulations into our schools.
	Schools will not be impressed by the good will of the noble Lord, Lord Dearing, the noble Baroness, Lady Sharp, the Minister or anyone else who says: "We have sympathy with the schools. We really do think that they are overburdened with bureaucracy. We really do think that there is too much of it. We do think that there are too many regulations. But we shall not go into the Lobby to support the amendment". The schools will not be over-impressed with that. They will be very impressed with this House if it first of all recognises that there is a problem—everyone who has spoken today, including the Minister, agrees that there is an issue. If they came into the Lobby with me and gave the Government the opportunity suggested by the noble Lord, Lord Monson, to tidy up this amendment—so that it is not just a practical issue for schools, but in such a way that bureaucracy will be reduced and time will be freed up to do what they should be doing; namely, teaching children—then the proposal will be made more deliverable as a result of the expertise which the Minister has at her command and which I do not.
	There should be a bonfire of unnecessary regulations and documents which tax the precious time of governors, heads and teachers. I wish to test the opinion of the House.

On Question, Whether the said amendment (No. 13) shall be agreed to?
	Their Lordships divided: Contents, 135; Not-Contents, 128.

Resolved in the affirmative, and amendment agreed to accordingly.
	Clause 19 [Governing bodies]:

Baroness Sharp of Guildford: moved Amendment No. 14:
	Page 12, line 37, at end insert "of whom at least one shall be a teacher and, with the exception of the governing body of a small school, another shall be a member of the support staff"

Baroness Sharp of Guildford: My Lords, Amendment No. 14 relates to school governors and the new stakeholder model of school governors being introduced. The amendment has had a good deal of discussion both in Committee and on Report. As has been noted, the current regulations for governors in schools were introduced in 1999. The Government are proposing to change those within two years. There has been some discussion as to whether it is necessary to change those regulations. We have given up battle on that. The Government seem to be determined to introduce the so-called stakeholder model.
	In the previous rules there were separate categories for teacher and support staff governors. That was the first time that support staff governors had appeared. It was a considerable achievement on their part. A result of the stakeholder model is that that category now disappears and there is only one group. Persons will be appointed as staff governors, irrespective of whether they are teachers or support staff.
	The Government are probably aware that that has caused unease among the teachers and real hurt among the support staff who felt that they had achieved a great deal on the previous occasion. They were pleased. They now feel that all that has been lost, in particular because the new regulations specify that there should be at least one teacher among the staff represented. The representation of the support staff is not mentioned.
	We have tabled the amendment again because it is a just cause. On the previous occasion the Minister rejected the amendment partly because of our reference to very small schools. One of the objections raised in Committee was that in a village school where there is only a head, a teacher and a member of support staff, all three members of the school staff would be on the governing body. It was felt that that would be a little extreme.
	That was countered on Report by suggesting that we should limit the exception to the governing body of the smallest category of schools. We were told that there was no such thing as a "smallest category of schools". We have now tabled two amendments which mention the possibility of a limitation in the case of the smallest category of schools, and include a definition of a small school in order to overcome that objection.
	I hope that the Minister will look kindly on Amendment No. 14. Some hurt has been caused to support staff in schools as a result of the proposed change. It would be good to see them remembered and thought about. Therefore, I hope that the Minister will see fit to accept the amendment. I beg to move.

The Lord Bishop of Blackburn: My Lords, I shall speak to Amendment No. 15, which is in this group. On Second Reading, a number of noble Lords spoke positively in favour of the special character of voluntary-controlled Church of England schools. The Minister has been helpful on the issue at earlier stages of the Bill and has indicated the Government's intention to ensure, through regulation, that voluntary-controlled and foundation schools of a religious character have at least two foundation governors. I welcome that assurance.
	So why am I bringing the issue back once more? We are concerned with the character of a particular category of schools. What does it mean to be a voluntary-controlled school? What makes such a school? In part, their governance is vital, representing a delicate balance of interests. My humble submission is that anything less than two governors, as a legal requirement in primary legislation, could destroy that balance.
	The Minister has accepted that for some Church schools the foundation should be protected in primary legislation. She moved an amendment to ensure that foundation governors of voluntary-aided schools should outnumber the other governors and gave assurances that regulations would make it clear that they should outnumber other governors by two.
	I am asking for similar protection to extend to voluntary-controlled and foundation Church schools, where the place of the foundation representing the interest of the Church and the particular religious characters of those schools is more precarious than in voluntary-aided schools.
	Almost all these schools predate the Education Act 1944. The Church of England founded them, often in the 19th century, well before government grant was available to help with capital funding. The voluntary-controlled status was an ingenious and creative solution to a particular problem in 1944, but it has stood the test of time. It reflects visibly and practically the Church of England's understanding of itself as a folk Church serving this nation.
	Voluntary-controlled schools serve their local—often rural or inner-city—communities entirely inclusively, providing education for all who seek it on usually the same kind of admissions criteria as our community schools. However, they often have a closer link with the local community through a prized and important relationship with their parish church.
	I press the issue because experience has shown that sometimes it is difficult to remind voluntary-controlled Church schools that they are Church schools of a particular kind if foundation governors are always outnumbered by the other governors.
	In 1998, the Government recognised the importance to the Church of working to preserve the religious character of such schools in times that may be adverse for religious schools. The School Standards and Framework Act of that year allowed the governing body, when appointing a head for such a school, to have regard to that person's ability and fitness to preserve and develop the religious character of the school in the controlled status. I readily and gratefully acknowledge the support that the Government give to Church and other faith schools. I also acknowledge the support given by the previous government.
	Our point is that, although primary legislation can be changed, it cannot be changed as easily as can regulations. The Government's present commitment may not always be reflected by their successors in office.
	The amendment is modest in its demands, but would be wide in its effects. It does not in any way conflict with the stated government policy on the issue. The Minister said on Report that her door was open on the issue. A number of us went through it to discuss this. I hope that she is willing to support the amendment.

Lord Alton of Liverpool: My Lords, very briefly, I support the right reverend Prelate the Bishop of Blackburn on Amendment No. 15. He has eloquently made the arguments behind the amendment. One of them is about the autonomy of Church schools. Another is about their changing character, should there not be sufficient governors—in this case foundation governors—who are committed to the ethos of that school. At a time when the Government have signalled their willingness to allow further faith schools to be created and have seen the value of those schools and the contribution that they make to our education system, it would be ironic if the ethos of existing Church schools was diluted because insufficient protection was given to the governing body.
	However, like the right reverend Prelate, I am conscious of the support that the Minister has given to Church schools throughout the Committee and Report stages and the sensitive way in which she has dealt with these issues. I hope that she will be able to tell your Lordships more about the regulations that she intends to introduce. Although the right reverend Prelate is correct that primary legislation is a greater safeguard than regulations, I hope that she will be able to say enough this evening to avoid us having to press the amendment to a Division.

Lord Dearing: My Lords, I support all three amendments. I was diffident about supporting the noble Baroness, Lady Sharp, until I saw the protection clause for small schools. My experience on two governing bodies is that there is value in having staff governors.
	I am conscious from some work that I have done on Church schools of the slight nature of the Church's position. The head does not have to be a practising Christian, but must have the ability and the attitude of mind to carry forward the ethos of the school. Two governors constitute a small minority on the governing body. There is no point having Church schools unless they are distinctive. Those who come from a church background can contribute most to that distinctiveness. If we are to continue to have Church schools—that has been the will of this House—it is fundamental that they should be distinctive. I hope that the Minister will be able to give us clear satisfaction that there is no doubt that that will be maintained.

Baroness Howe of Idlicote: My Lords, I shall briefly support all three amendments. It is essential that one of the partners of the environment in which those working in a school are engaged should be part of the governing body. My view is that pupils should also be represented on the governing body, but I may have to wait a little longer for that.
	I support what my noble friend Lord Dearing said about Amendment No. 15. Two is not a large number. When I chaired the commission on the future of cathedrals, one or two representations were made about the over-dominance of the religious representation in schools. A lot has changed since that time. Two is a minimum. I entirely support that proposal. I hope that the Minister will be able to accept all the amendments.

Baroness Ashton of Upholland: My Lords, before I respond to the amendments, it is pertinent to say a little about the legal framework that we are constructing in the Bill, given that in part the amendments would place on the face of the Bill matters that will be dealt with in regulation.
	I hope that I have made clear that our approach is for matters of principle to be laid down in primary legislation and process matters to be covered in regulation. In education, we inherited a vast amount of process laid down in primary legislation. That is why we have converted a number of processes and procedures into delegated powers, in order that they can be laid out as necessary in regulations. That will enable us to create more flexibility to tailor the procedures to changing circumstances and enable us to create more freedom for the front line—if I may describe teachers and governors as such—by making those regulations less prescriptive.
	The noble Baroness, Lady Sharp, and the right reverend Prelate should bear in mind that regulations have equal force in law to provisions in primary legislation. That is important when one looks at where one wishes to position a particular element. We are looking to put the processes and procedures into regulations.
	I turn to Amendment No. 14. I am aware of the concerns expressed in some quarters to see parity of representation on school governing bodies between support and teaching staff. The noble Baroness has tabled an identical amendment to that she tabled on Report, together with her further Amendment No. 16 which defines small schools. I explained then that all governing bodies will be able to choose a model which suits their needs best within a framework of guiding principles.
	So there will no longer be any necessary connection between the size of a school and the size of its governing body. Even the smallest school if it wished would be able to choose the largest model. In order to increase flexibility, we are deliberately coming away from pegging representation to size of school. That is an important point because it is fundamental to our agenda of giving schools greater flexibility. But the Government's motivation could be being misinterpreted as a drawing back from the principle of support staff representation on school governing bodies. That is certainly not the case, particularly as it was the Government's 1998 legislation that first provided that opportunity, as the noble Baroness said.
	I am grateful for the opportunity the amendments provide to allow me to place on the record the Government's commitment to the involvement of support staff as members of school governing bodies. Noble Lords will know only too well that support staff play a vital and increasingly important role in the life of our schools. They are being employed in greater numbers in a wide range of capacities. Life in our schools is the richer for them, and their greater involvement is of considerable benefit to other staff as well as to pupils and their parents.
	The move to a single governance category to cover all staff employed to work in maintained schools is not intended to suggest that support staff are not important or that their presence on governing bodies should be regarded as an optional extra. It was previously the case that support staff could be included only if they were parents, or if the governing body decided to co-opt them, with neither option giving support staff any say in who should represent them. The Government took an important step to include them in the 1998 legislation by providing for elected non-teaching staff.
	The single staff category also emphasises that all staff are part of a single stakeholder group as they are employed to work at the school and owe their livelihoods to it. I know from personal experience that support staff are making a valuable contribution to the work of governing bodies. Where the situation is working well, a governing body would be foolish indeed to deny itself access to individuals who, while just as intimately involved in the school, can bring a different perspective from teachers.
	But we need to provide for those governing bodies which, despite strenuous efforts and much good will, have found it impossible to persuade any member of the support staff to stand for election as a staff governor. One of the benefits of the new constitutional arrangements is that governing bodies should be able to choose the size and composition that works best for them and minimise unnecessary vacancies.
	There are good reasons why governing bodies may wish to have a smaller governing body, particularly for a very small school. Smaller governing bodies make provision for only two staff representatives. One of those places, as noble Lords are aware, will be designated for the head teacher and cannot be reassigned, even if the head does not wish to become a governor. A second place will be reserved for a teacher. But if no teacher chooses to stand for election and other staff wish to do so, we have decided that the school's staff will be able to elect a member of the support staff to fill that second place.
	Having further considered the arguments put forward by the noble Baroness, Lady Sharp, I want to place on the record a further change that I propose to write in regulations. As noble Lords will remember from Report stage, the draft regulations already provide that at least one staff governor in addition to the head teacher must be a school teacher unless no school teacher stands for election. Where constitutional models provide at least three staff governor places, we will provide that one of those places should be reserved for a member of the support staff, unless no member of the support staff wishes to stand for election.
	I hope that as governing bodies consider their options for new constitutions they will look closely at what support staff are already contributing to the work of their governing body or could in future, and, unless there are good reasons to opt for a smaller model, select a constitutional model which will allow for support staff representation.
	Amendment No. 15 seeks a requirement that the regulations made under Clause 19 should provide for at least two foundation governors on the governing bodies of voluntary controlled and foundation schools with a religious character. As I said on Report when we were debating a similar amendment, I do not believe that there is any difference of opinion between us. I gave the House my absolute assurance that the regulations will indeed provide for a minimum of two foundation governor places at voluntary controlled and foundation schools. It has been a key tenet of our approach to the constitutional proposals that the primary legislation should restrict itself only to the key principles, with all the details in secondary legislation.
	While it grieves me dearly to say no to the right reverend Prelate the Bishop of Blackburn, for me to agree to the amendment would mean breaking faith with all the other stakeholder groups who have a right to be treated equally. I understand his concern to ensure that the ethos of controlled and foundation schools with a religious character should be protected. But we are undertaking to meet his request by providing in regulations—I have explained the force of regulations in law—that foundation representation in voluntary controlled and foundation schools should provide at least two and up to and including one quarter of places.
	The governing body will continue to be obliged to uphold the school's trust deed and honour the ethos statement in the school's instrument of government. If there are concerns at any time that a governing body is acting in a way which would undermine the school's religious ethos, it will be open to any person to complain to the Secretary of State under the provisions in Sections 496 or 497 of the Education Act 1996 that the governing body is acting unreasonably in exercising its powers, or that it has failed to discharge that duty.
	In considering any complaint made to her, the Secretary of State is required to take account of a school's category, and therefore the requirement to conduct a school with a religious character in accordance with the school's ethos statement. All the amendments seek levels of detail that we believe are more appropriate for regulations. I hope that my assurance on our commitment to school support staff, and the changes I have proposed to the regulations, will persuade the noble Baroness, Lady Sharp, to withdraw her amendment. I also trust that the additional assurance on the preservation of the religious character of controlled and foundation schools will lead the right reverend Prelate the Bishop of Blackburn not to move his amendment.

Baroness Sharp of Guildford: My Lords, I thank the Minister greatly. She has given me most of what I wanted. It would have been nice to have it in the Bill, but I realise that that would not fit with the stakeholder model. It is the next best thing to have the provisions stated in regulations and I am delighted. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 15 and 16 not moved.]
	Clause 24 [Federations of schools]:

The Lord Bishop of Blackburn: moved Amendment No. 17:
	Page 15, line 27, at end insert—
	"(3A) A school that is a Church of England school, a Church in Wales school or a Roman Catholic Church school shall not be federated without the consent of the appropriate diocesan authority, and where a federation referred to in subsection (1) includes such a school, the instrument of government for the federation shall not be changed without the consent of the appropriate diocesan authority.
	(3B) In the case of a foundation school, a foundation special school or a voluntary school which has a religious character but is not a Church of England school, a Church in Wales school or a Roman Catholic Church school, the school shall not be federated without the consent of the persons who appoint the foundation governors of the school, and where a federation referred to in subsection (1) includes such a school, the instrument of government for the federation shall not be changed without the consent of those persons.
	(3C) Where the consent of the appropriate diocesan authority is required under subsection (3A) or the consent of the persons who appoint the foundation governors of the school is required under subsection (3B) such consent must not be withheld unless there are reasonable grounds for so doing."

The Lord Bishop of Blackburn: My Lords, although procedures forbade me from rising at that point I am grateful for the Minister's assurances on Amendment No. 15. I am also grateful for her full reply when I last raised federations on Report. However, on reading Hansard, and reflecting with others on the detail of her comments, it became clear to me that I have reluctantly to return to the matter, even at this late stage.
	My support and encouragement for federations, which is on the record from previous debates, remains; that is why I rise to move this amendment. I commented in the earlier debate on the helpful note the Minister's officials prepared on the impact of federation on the religious character of a school. I raised four issues that have not been addressed adequately and to which I return now.
	The note referred to voluntary aided schools with a religious character, but had nothing to say about voluntary controlled schools, whose individual religious character is particularly important to the Church of England. On Report the Minister helpfully referred to the importance of reserve teachers in such schools and how that would be preserved in the federation. I made a brief reference on another matter to the place of head teachers in such schools of a religious character, but in Section 60 of the School Standards and Framework 1998 Act the wording was introduced—a significant innovation from the Church's point of view—that the governors could appoint a head teacher for a voluntary controlled or foundation school on the basis of a candidate's,
	"ability and fitness to preserve and develop the religious character of the school".
	That, of course, quite rightly fell short of a religious test but did allow for the first time the choice of a head who would be positively sensitive to, and supportive of, the school as a Church school whatever his or her own religious beliefs. As I said earlier, the religious character of a voluntary-controlled school is harder to preserve than that of a voluntary-aided school. Thus, the Government accepted our innovative wording. It will be important in a federation to preserve that character. I hope to hear an assurance from the Minister that regulations will acknowledge and, indeed, allow for that in a voluntary-controlled or foundation school.
	Secondly, the helpful note identified arrangements for the appointment of a head teacher where a voluntary-aided school is part of a federation, but not for a proportion of the other staff where joint staff appointments are to be made. Section 60 of the 1998 Act put positively for the first time the governing body's right in a voluntary-aided school to appoint teachers who hold the religious tenets of the school in question and who do not contravene the moral precepts of the religion in question. That was important, in view of the forthcoming introduction of the Human Rights Act, as a contribution to the preservation of the character of the school. It had been implicit in legislation dating back to 1944 but was made explicit for the first time in the 1998 Act.
	What would be the impact, for example, on a rural voluntary-aided school federated with two other community schools in neighbouring villages, with one head and in total, say, nine teachers? I hope that the Minister can give me the assurance that in such a case there should be a means whereby the three teachers who would normally be teaching in the voluntary-aided Church school—or, in any case, three of the teachers if the teachers were appointed to work across all three schools—could be appointed under the terms of Section 60 of the 1998 Act, and that regulations will so provide.
	Thirdly, I was concerned that the note referred to a situation where there was disagreement between the governing body, the LEA and the diocesan authority over a new instrument of government. I was helpfully told that in those circumstances there would be an appeal to the Secretary of State. However, it would be helpful to have some indication of the principles on which the Secretary of State might decide the case.
	The Minister helpfully referred on Report to several bases for the Secretary of State's judgments. However, I would like to have heard that the Secretary of State would seek to ensure that the trust deed of the school—its purpose as a religious school—would not be contravened by the proposed federation and that she would bear that in mind as well in seeking to resolve any unfortunate dispute. I assume that it will not be difficult for the Minister to give that commitment, but it would be good to hear it and to have it on the record. The Church or other religious bodies entering a federation would not seek preferential treatment but equal opportunities and a respect for the original charitable purposes of the school.
	Finally, the note outlined an exit strategy if a federation were to some minds going wrong. The final decision would rest with the governing body of the federated schools and its decision would be absolute. As I understand it, if the governors representing a religious foundation within the federation wanted, for the sake of preserving the religious character of the school, to withdraw their school from a federation, they could do so only by persuading a majority of their fellow governors to agree. I hope that the Minister shares my view that that might significantly discourage religious schools from entering the kind of federations that I should like to see them enter to the detriment of their potential role in creating inclusion and diversity particularly in the primary sector of our education service. In current proposals a majority of community school governors would decide on the future of a Church or other faith school. I predict that that might lead to unfortunate disputes.
	I am sorry to have taken so much time but it would help us and other religious communities willing to entertain joining federations—for the sake of social inclusion and community cohesion—if the diocesan authority or the body appointing foundation governors could appeal to the Secretary of State to withdraw their school from a federation where a federated governing body was not willing for such a withdrawal to take place. If the Minister were able to give me such an assurance, I would find it perfectly possible enthusiastically to recommend federations to religious schools, at least within the Church of England, without the need for a diocesan authority to have a veto, as the amendment seeks to achieve. I beg to move.

Lord Alton of Liverpool: My Lords, I support Amendment No. 17 which the right reverend Prelate has just laid before your Lordships. I wish particularly to underline the point he made about how the amendment could enhance the Government's laudable objective of trying to create federations. If the kind of assurances which the right reverend Prelate has sought cannot be given, many Church schools from varying religious backgrounds—the right reverend Prelate mentioned Anglican schools but from the discussions I have had with Roman Catholic authorities I believe that they hold the same views—would consider that a major disincentive to entering federated arrangements. The very proper objective of trying to encourage schools to work with often secular counterparts in the same areas so that they can properly share the assets, resources and expertise that they have and consolidate the educational opportunities within particular districts will be lost due to a fear of diluting the religious ethos and character of a school.
	The right reverend Prelate was right to raise the issue of an exit strategy. Schools need to know how they can get out of federated status if those arrangements do not work out in the way that they hoped. It would do much good if the Minister were able to give assurances on those matters. I know that she would not wish to see the dilution of the religious ethos of schools; she has made that clear throughout the proceedings on the Bill. If the assurances that the right reverend Prelate has asked for can be given and placed on the record, schools could enter into sensible proposals with some degree of enthusiasm. If those assurances cannot be given, I fear that the right reverend Prelate is right and that schools will decline to take part in federated status.

Lord Dearing: My Lords, I hope that I may add a few words on the exit strategy which concerns me. Let us consider, for example, a voluntary-controlled school with only two foundation governors. The majority of the non-foundation governors could take the school into a federation. If the school is then unhappy with that and appeals to the governing body of the federation, a decision will lie with the federation. There seems to be no exit. Some federations will not work. People can be peculiar. If people behave in a peculiar fashion, federations will not work. There is wisdom in providing some mechanism for a participant to withdraw other than the final decision lying with the governing body of a federated institution.

Baroness Ashton of Upholland: My Lords, I agree with the noble Lord, Lord Dearing, that people can be peculiar. Of course, he is never ever peculiar!
	I start by emphasising that I appreciate the concern of the right reverend Prelate the Bishop of Blackburn and that of the noble Lord, Lord Alton, that federations should in no way diminish the religious ethos of schools of a religious character. As the noble Lord, Lord Alton, rightly said, the Government are equally committed to ensuring that the religious ethos of schools with a religious character should be preserved.
	As regards an exit strategy, perhaps I may provide some reassurance on the position for schools that wish to leave a federation. If any stakeholder group, including foundation interests, trustees or the diocesan interests, petition the federated governing body for their school to leave their federation, but have their petition turned down, they will be in a position to refer the matter to the Secretary of State under the provisions of Sections 496 and 497 of the Education Act 1996, if the governing body has failed to fulfil a statutory duty or acted unreasonably.
	If the Secretary of State is required to arbitrate on whether a school should or should not leave a federation, she will look at each case on its merits. One of the factors she will consider is whether the religious ethos of a school, as stated in the school's trust deed, is being undermined or would be likely to be undermined by not leaving the federation. I can say clearly that we regard the preservation of the religious character of schools as an important matter. In this, as in any other, determination by the Secretary of State, we would seek to ensure that the duties to preserve and develop the character of schools are fulfilled.
	It is important to note that where the religious character of a school has been adversely affected, the Secretary of State would be in a position to direct the governing body of the federation to take steps to rectify that position as they would be under a legal duty to uphold the school's religious character as set out in any trust deed and the ethos statement in the instrument of government.
	I turn to staffing. I fully understand that the sharing of staff within a federation is an area of concern to the Churches. However, I emphasise that one of the major advantages of federation is the ability to facilitate the sharing of staff resources to the maximum benefit of all schools within the federation.
	We will stipulate that if schools wish to have a policy to share staff within the federation, that must be included as part of the proposals on which they will consult extensively with all interested parties before any decision to federate is taken. I have previously stated that if it is proposed to share staff after schools have entered a mixed category federation, voluntary-aided foundation governors can decide whether the voluntary-aided school should be involved in those shared staffing appointments.
	I understand the importance of voluntary-controlled and foundation schools with a religious character having the option, as the right reverend Prelate said, of utilising Section 60(4) of the School Standards and Framework Act 1998, which allows the governing body to have regard to an individual's ability and fitness to preserve and develop the religious character of the school when appointing a head. In the event of there being a "same category federation" involving only voluntary-controlled or foundation schools of a religious character, schools will indeed have open to them the option of utilising Section 60(4). However, certain difficulties could arise in the event of voluntary-controlled and foundation schools with a religious character being involved within mixed category federations with schools without a religious character. I hope that noble Lords understand that European law will not allow us to extend what would be described as religious discrimination to schools without a religious character. Therefore, the most sensible solution to me to meet the requirements of voluntary-controlled and foundation schools, while ensuring that we remain in compliance with European law, is the concession that I am about to offer.
	I intend that if it is proposed that schools within a mixed category federation should appoint shared staff after federation has taken place, we will allow representatives of voluntary-controlled and foundation schools of a religious character who will sit on the federated governing body to be able to veto the involvement of their school in the appointment of any shared staff, including, of course, head teachers. If representatives take that position, they would effectively be stating that they wish to keep the staffing arrangements for their particular school separate.
	I am committed to ensuring that where schools wish to keep their staffing arrangements separate, staff will continue to be appointed to each school within the federation on the same basis as they would have been if the schools had remained separate. That will ensure that voluntary-controlled and foundation schools of a religious character, within a mixed category federation, will be able to appoint a head for their school in accordance with Section 60(4). I hope and believe that that will meet the needs of the right reverend Prelate.
	We will put in place arrangements to maximise benefit for schools that wish to share staff by making the process as straightforward as possible and allowing governing bodies to think strategically in terms of allocation of staff resources throughout the federation. I recognise the importance of certain safeguards being in place for the appointment of new shared staff to schools within a mixed category federation. That is why we will allow for voluntary-aided foundation governors to be able to veto the appointment of a particular individual as head to their school (whether shared or not), if they feel that such an appointment would be detrimental to maintaining the religious character of their school.
	I hope that the right reverend Prelate—and other noble Lords—will see from the detailed nature of this reply that I am as anxious as he is to ensure that the religious character of schools within mixed category federations is maintained. I also hope that he is reassured by the safeguards.
	No school will be required to join a federation. Where schools with a religious character have concerns about preserving their religious ethos, the confederation model, which will allow schools to retain their individual governing bodies, will provide an alternative model for collaboration. We will of course be consulting extensively on draft regulations and guidance on federations with all interested parties. Before that stage is reached I will ensure that officials have further discussions with the Churches. It will be our firm principle that federation should not in any way undermine the religious character of schools. I hope that in the light of those assurances the right reverend Prelate will be prepared to withdraw his amendment.

Lord Alton of Liverpool: My Lords, before the Minister concludes, I point out that she has characteristically gone a very long way to try to address many of the arguments that have been advanced; many of us are grateful to her for that. Why is she opposed to the principle—or at least she has not dealt with it in her summing up—of a governing body of a school that is in a federation simply saying, following my noble friend's earlier point, "The relationships are not working and we now wish to leave the federation"? Why should not it be able to do that?

Baroness Ashton of Upholland: My Lords, it can indeed say that within the federation model. The issue is that schools that choose to adopt that model have one governing body, so the appeal is in a sense made to itself. If the body decides that it does not wish to let the school go, by whatever route is chosen—the obvious route involves a vote—I have put in place an appeal mechanism. The diocesan board or the governors involved could appeal to the Secretary of State. I have added on to the process of wishing to leave the federation an additional safeguard to ensure that that is in place.

The Lord Bishop of Blackburn: My Lords, I am immensely grateful to the noble Baroness for her detailed reply and for addressing so many of the concerns that I raised. For me, this is a matter of vision. I want federations—and confederations, for that matter—to have a variety of schools within them. That is the prize. What may appear to some to be rather nit-picking amendments about this or that—I do not much like getting into such debates—are needed in order to enable the wider vision of what might happen, particularly in rural areas, to happen. I am enormously grateful to the Minister, particularly for her reply on the exit strategy. That is a critical area for those of us who would like to encourage at least some pilot projects of this kind. I am grateful for the answers on staffing and the vetoes that will appear in regulations. I hope that the federations will be based on such a firm foundation of collaboration and co-operation that vetoes will not need to operate. However, putting them in place can be the basis that ensures that they do not operate because people have a security from which they might work. I am enormously grateful.
	Before I withdraw the amendment—it is my last amendment—I pay tribute to and thank the Minister, her ministerial colleagues and the officers of the department for the gracious and kindly way in which they have dealt with me. I am a new boy to this process. I am particularly grateful to the Minister for her open-door policy, which has been extremely helpful in aiding us to construct a Bill which will, I hope, lead to the advancement of better education in our country. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 27 [Limits on power to provide community facilities etc.]:

Baroness Ashton of Upholland: moved Amendment No. 18:
	Page 17, line 26, leave out from "body" to "governing" in line 27 and insert—
	"(a) shall consult—
	(i) the local education authority,
	(ii) the staff of the school, and
	(iii) the parents of registered pupils of the school,
	(b) where the proposed exercise of the power would affect registered pupils of the school and the governing body consider it appropriate in view of their age and understanding to consult all or some of them, shall consult the registered pupils or such of them as the governing body consider it appropriate to consult, and
	(c) shall consult such other persons as the governing body consider appropriate.
	(5) In exercising the power under section 26(1) or consulting under subsection (4), a"

Baroness Ashton of Upholland: My Lords, in moving this amendment, I shall speak also to Amendment No. 19.
	Amendment No. 18 delivers the commitment that I made to, I believe, the noble Baroness, Lady Sharp, on Report, to extend the duty of governing bodies to consult parents and school staff as well as LEAs before providing community services and facilities on school premises.
	While accepting the view of the noble Baroness and other noble Lords that parents and staff should be consulted, we think that the list of those who should be consulted should be extended to include pupils and any other persons the governing body thinks it appropriate to consult.
	Extending the ambit of consultation on the face of the Bill rather than limiting it to parents and school staff recognises the significant interest of other groups who might be involved in, or affected by, the provision of community services on school premises. We will be issuing guidance later this year to support schools and other interested parties in developing these services. The guidance will, among other things, help schools to manage the consultation process in a sensitive and unburdensome way.
	Amendment No. 19 simply removes phrasing that would otherwise duplicate that in the previous amendment. I beg to move.

Baroness Walmsley: My Lords, I thank the Minister for tabling the amendment, which I believe is in response to one tabled by these Benches concerning additional consultation with appropriate people. A number of such amendments have been accepted by the Minister during the passage of the Bill, for which we are grateful. We are also grateful to the NUT and in particular Emily Evans, for the assistance given in tabling such amendments, which we believe improve the Bill.

On Question, amendment agreed to.

Baroness Ashton of Upholland: moved Amendment No. 19:
	Page 17, line 29, leave out "about the exercise of the power"
	On Question, amendment agreed to.
	Clause 29 [Governors' reports and other information]:

Baroness Ashton of Upholland: moved Amendment No. 20:
	Page 18, line 36, leave out subsection (3) and insert—
	"(3) The governing body of a maintained school shall provide the local education authority with such reports in connection with the discharge of the functions of the governing body as the authority may require (either on a regular basis or from time to time) for the purposes of the exercise of any of the authority's functions.
	(4) The head teacher of a maintained school shall provide the governing body or (as the case may be) the local education authority with such reports in connection with the discharge of his functions as the governing body or the authority may require (either on a regular basis or from time to time) for the purposes of the exercise of any of their functions.
	(5) Where a requirement under subsection (4) is imposed on the head teacher by the authority—
	(a) the authority shall notify the governing body of that requirement, and
	(b) the head teacher shall give the governing body a copy of any report made by him in complying with it."

Baroness Ashton of Upholland: My Lords, in moving Amendment No. 20 I shall speak also to Amendment No. 21. The Government have listened to concerns about their intentions expressed on Report, and I shall speak now to two government amendments tabled in response. Amendment No. 20 replaces the regulation-making power in subsection (3) of Clause 29 by the wording currently set out in Section 42(3), (4) and (5) of the School Standards and Framework Act 1998. It is clearly essential in a situation where schools have greater autonomy that governing bodies and local education authorities should have the necessary information they need, much of which can come only from the school, to undertake their statutory duties.
	The regulation-making power currently in the Bill would have allowed the Secretary of State to specify precisely what information should be provided, which the current 1998 Act provision does not. However, we listened carefully to the points made on Report by the noble Baroness, Lady Blatch, about those provisions. As indicated on Report by my noble friend Lord Davies, we reconsidered the issue and have concluded that we do not need a regulation-making power to prescribe precisely what information governing bodies or head teachers should provide. The present legislation, which rests on the recipient party demonstrating that it needs specific information for a particular purpose to fulfil a statutory function, appears to be working well. On that basis we are content to replicate it in Clause 29. That fulfils the commitment we made on Report.
	I turn to Amendment No. 21. On Report I emphasised my commitment to putting in place a range of options which will provide a spectrum for strategic collaboration between schools. That will range from governing bodies delegating some of their functions to a joint committee, ceding some of their responsibilities to an overarching body—hence the notion of a confederation—or deciding to disband their individual governing bodies and come together under a single federated governing body. It will be entirely up to governing bodies which of those alternative models of governance, if any, they use. We do not wish to nudge schools one way or the other. I am happy to reiterate that a confederation option under Clause 30 is as acceptable as schools federating under a single governing body or, indeed, for schools to pursue none of those.
	I am committed to ensure that each of those options allowing for strategic collaboration is presented to schools as being of equal value and importance. It is for schools, in the light of their particular circumstances and needs, to choose which option if any best meets their needs at any one given point in time. Indeed, as the circumstances of schools change, they may wish to alter the form of strategic collaboration for which they opt. It is important that schools recognise that they have that flexibility and a range of different options open to them.
	I intend to start as I mean to go on. Therefore, I shall move that Clause 30, on the collaboration of schools, shall follow on directly from those on federations. It seems entirely sensible to me that clauses allowing for strategic collaboration of schools should be placed together in the Bill and given equal importance and visibility. In the light of those explanations, I beg to move.

Baroness Blatch: My Lords, I am pleased to respond to the noble Baroness and thank her for removing a second set of regulations. I am grateful to her and hope that the amendment will be passed.

Baroness Sharp of Guildford: My Lords, I add my thanks to the noble Baroness for both amendments, which improve the Bill substantially. I am delighted by her acceptance of my concept of "confederation" as distinct from "federation", which appeared in the Bill. I have learnt from this exercise that a clause heading can be changed without tabling an amendment. I objected to the heading of what is now Clause 30 of the Bill; that is, Arrangements for joint discharge of functions. That has been changed to Collaboration between schools, and now appears just after Clause 25 on federations. That is precisely what I wanted to happen. I thank the Minister for that.

On Question, amendment agreed to.
	Clause 30 [Collaboration between schools]:

Baroness Ashton of Upholland: moved Amendment No. 21:
	Transpose Clause 30 to after Clause 25.
	On Question, amendment agreed to.
	Clause 40 [Determination of specified budgets of LEA]:

Baroness Walmsley: moved Amendment No. 22:
	Leave out Clause 40.

Baroness Walmsley: My Lords, in moving Amendment No. 22 I shall speak also to Amendments Nos. 23 and 24, which I have asked to be grouped with it. I hope that the late grouping does not inconvenience those noble Lords I was unable to notify. All three amendments concern the funding of schools and who makes decisions about that.
	Amendment No. 22 refers to Clause 40, which I propose should be deleted from the Bill. Noble Lords will note that all three amendments concern deleting whole clauses from the Bill and may be subject, therefore, to the same criticism as that made by the noble Lord, Lord Carter, on Amendments Nos. 7, 11 and 12 tabled by the noble Baroness, Lady Blatch. If that is the case, I point out that had the Government notified these Benches of their intention to object to that kind of procedure, we might have changed our strategy earlier on in the Bill and perhaps even changed our normal practice of not calling Divisions in Committee.
	However, the contents of this clause means that the Government would decide how much a local authority needs in order to run its centralised functions and how much should go directly to schools by the new funding arrangement of splitting the spending assessment into those two sections. Once the LEA has received the two assessments, the clause provides that the Secretary of State must be informed how much the schools budget will be for the following year, often before decisions have been made by the LEA about other budget areas for which the authority has responsibility. That matter gave us concern in earlier debates.
	Important issues—for example, how much needs to be spent on social services and transport—may not have been decided by the time that information needs to be given. Then, the unelected schools forum will be the body which decides how much can be deducted from schools budgets for various purposes determined by regulations.
	At earlier stages in the Bill we made the case that decisions of that kind on the spending of public money should be made by a locally elected body which is accountable at the ballot box. In her reply on Report the noble Baroness spoke of "funding fog" and said that it was unnecessarily difficult to judge whether an education authority's spending is too low, needlessly high or just about right, and that this measure is necessary to correct that.
	We cannot accept the argument put forward by the noble Baroness. We believe that it is for the LEA to judge such matters and for voters to decide what to do about it if they think the LEA has got it wrong. The voters will certainly have enough information to make a reasoned judgment. Our schools are the most inspected and our children the most frequently and rigorously measured and assessed in the whole of the developed world. Voters have Ofsted reports, SATs, GCSE results and league tables to help them judge whether an LEA is doing a good job. We should then let them make their judgment in the ballot box.
	Local authorities are having their hands tied on far too many issues under this Government. There is no trust of local government and it is time that someone said, "Stop, enough". That is what I say today. That is why we need to delete a whole clause. It is a matter of fundamental principle. We must not continue to put LEAs into a straitjacket and then blame them for the outcome. We have a choice between bureaucracy and democracy. I choose democracy.
	Amendment No. 23 proposes to delete Clause 41 from the Bill. That clause gives the Secretary of State the power to intervene and insist that LEAs give a certain minimum budget to schools every year, with no regard to what they might have done the year before or even for many years before. The Minister is aware that many LEAs have for many years given a great deal more to schools than was allowed for by the standard spending assessment. Of those few which have not, a very small number have had a poor Ofsted report. As usual, the Government are taking a very large hammer to crack a very small nut.
	An LEA should be free to decide that, in any one year, it needs to retain a little of the school budget for central services without interference from the Secretary of State, especially if it subsidised the school budget the year before. It boils down to this: do we want further central control of the powers of LEAs, or do we not? I think that we do not.
	Amendment No. 24 seeks to delete Clause 42 from the Bill. Clause 42 sets up unelected and unaccountable bodies called "schools forums", which would be allowed to make decisions about the deployment of public money when there is a perfectly good elected body—the LEA—which is better equipped to do it. The schools forum would be the latest in a line of costly education quangos. It would not necessarily be representative, consisting of around 50 stakeholders. Those local authorities that exhibit best practice at present do a much better job of consulting on school budgets than a schools forum, as envisaged, could ever accomplish.
	On the second day of the Report stage, the Government stated that these forums would cost schools about £200 per school per annum—an amount that is not inconsiderable given the enormous pressure on school budgets. But the main reason we object to these bodies is the principle that they would be unelected and unaccountable to the electorate at the ballot box. The Minister gave a short list on Report of the matters on which the schools forums could make decisions under the provisions of the Bill. However, those are the subject of regulations that could easily be added to by more significant areas of expenditure at a later stage. This is what worries us: it could be library services today, and who runs schools tomorrow. Although the Government are still consulting on how the forums would work, to me, that is just like consulting on the arrangement of the deck chairs on the "Titanic". The whole concept of schools forums is fundamentally unsound.
	There is really no reason to elaborate any further on the matter. We have made the arguments many times and in many different ways during the course of the passage of the Bill. Unfortunately, the Minister has so far not been able to counter our concerns in any satisfactory way. I beg to move.

Baroness Blatch: My Lords, I have opposed schools forums at each stage of the proceedings on the Bill. They will be the latest in a line of costly quangos. On Report on 19th June, the Minister said (at col. 808 of the Official Report) that the cost of such quangos was based on them "meeting three times a term". I have to point out that that amounts to four-and-half days per teacher per year; that 10 teachers would mean 45 days out of school; and that 20 teachers in an average-to-large LEA would mean 90 days out of school. If you multiply that by the number of LEAs, we would have yet more teachers out of school, away from the classroom, and, therefore, not teaching children. That is something that I simply cannot support.
	I should add that there are those who believe that forums will in fact mean more money going into schools. In practice, I am afraid that that would not be the outcome. LEAs would need to hold money back to fund such bodies, as the Minister said. The Government could make a very real difference by not imposing yet more quangos and by releasing some of the central funding that they hold back to provide more money for schools.
	Finally, the London/Brent authority has already sent out a form asking for volunteers to sit on the schools forums. The authority has said that the forum is not a decision-making body, which is wrong. It is a decision-making body. It has said that there will be around 20 members, half of whom will be teachers—so we are talking about the numbers of days out of school to which I referred earlier. On the question of how the forum will operate, who chairs it, and how it conducts its business, the authority states that that will largely be a matter for the forum itself to decide. That is equally not true: the Bill will specify that through regulation. If the forums are allowed to decide how they operate, why cannot the same apply to governing bodies? That is a matter about which we argued at an earlier stage.
	These forums are quangos. They are unnecessary. I do not believe that they will enhance the experience of children in the classroom. I support the amendment.

Baroness Ashton of Upholland: My Lords, I take the point that both the noble Baroness, Lady Sharp, and the noble Baroness, Lady Blatch, do not like schools forums. However, I shall still endeavour to convince them.
	I shall begin by speaking to Amendment No. 22. I listened most carefully to what the noble Baroness, Lady Walmsley, said in her introductory remarks. I have to say that I am still unclear as to what the noble Baroness has against the clause that leads her to wish to get rid of it in total. I understand her concerns. As the noble Baroness rightly said, she has raised the issues of the role of schools forums and the reserve power at each stage of the Bill.
	Although schools forums and the reserve power make brief appearances in the clause, they are not the main purpose of the clause. Most of the clause seeks to do something that I hope we all agree is worth doing, whether or not we have the forum or the reserve power. Above all, it is about transparency. We believe that we have already achieved a great deal in this respect. LMS—the funding system that we inherited—was based on the general schools budget, which was rather narrowly defined. The financial statements that LEAs produced under LMS gave a breakdown of the general schools budget, but it was difficult to see the GSB in its wider context because the available information on LEAs' overall education budgets was contained in a return collected by what was then the Environment Department, and the two returns were not well dovetailed.
	The funding system that we introduced in 1999 is based on the local schools budget, which is broader than the GSB. Each education authority now has to produce a single financial statement that sets the LSB in the context of its education revenue budget as a whole. In other words, we now have a much better basis for judging how far the money provided by government is getting through to schools. Nevertheless, we believe that there is scope to reduce still further what I have described as a "funding fog".
	The school funding system is based on the local schools budget and the LEA funding system is based on the education SSA. Both are broad in their coverage, and yet their coverage is not the same. Moreover, as noble Lords will be aware, there are concerns about the fairness and the transparency of the SSA. Part of the problem is that the SSA has perhaps been trying to assess too much at once. That is why we intend to introduce two spending needs assessments instead of the present SSA. One will relate essentially to the cost of provision for pupils, and the other will cover the essential functions of the LEA. The assessments will be introduced under local government legislation.
	However, corresponding to the assessments, we shall have the separate school and LEA budgets. The key purpose of Clause 40 is to bring in these two budgets in place of the present local schools budget. LEAs' expenditure on front-line provision can then be bench-marked against a spending needs assessment that relates specifically to front-line provision.
	We believe that that will make for greater clarity and make it easier for the spending plans of education authorities to be scrutinised in an informed way. I had hoped—indeed, I would have expected—that we could agree on that as something that we would all wish to achieve. I should add that, in developing such proposals, the department has worked closely with the Local Government Association and other relevant interests. There has been debate around the detail, and I have no doubt that there will be more, but the LGA welcomes the principle of separate budgets and assessments as a means of improving clarity.
	Therefore, on Clause 40, I hope that noble Lords will not allow their reservations about schools forums or the reserve power to stand in the way of what the bulk of the clause is designed to achieve. There will be opportunities to address these concerns, to which I shall refer later. But to reject the whole clause on the basis of such reservations would, in a sense, be to allow the tail to wag the dog. On the basis of wanting to have greater transparency and ability for informed scrutiny, which must be a desire of Liberal Democrats, I hope that the noble Baroness will feel able to withdraw this amendment.
	I turn to Amendment No. 23. I should like to make it clear that the clause is purely about the possibility of the Secretary of State setting a minimum budget for the schools budget in an area where the LEA has made very seriously inadequate proposals. Noble Lords have been sceptical about the assurances that we have given to the effect that the reserve power will be used sparingly. When the clause was debated in Committee in another place, my honourable friend the Minister for School Standards gave two assurances that I wish to repeat at this point. The first was that the reserve power would definitely not be used where an authority passed on the increase in its school funding assessment to its schools budget. That is a very clear statement, and one that I am very happy to repeat. But the second assurance was also important: even if the increase in the school funding assessment was not passed on in full, it would not necessarily follow that the reserve power would be invoked. As we make clear in the Explanatory Notes to the Bill, an authority's spend relative to its funding assessment is another of the factors we would consider before exercising the reserve power. If a local education authority spent well above its funding assessment and failed to pass on only a small proportion of the increase, we would not exercise this power.
	As I have previously explained, there will be a dialogue with a local education authority if we propose to set a minimum level of budget for an authority's schools: such an authority would of course be able to set out for us the full range of circumstances which led it to take a decision not to pass on the increase in school funding to its schools.
	The reserve power is not about the vast majority of authorities who share the Government's desire to see schools funded properly. They will have the freedom to do that. It is about a situation we expect to arise only rarely, where an education authority has not passed on an increase to its schools and by so doing it causes those schools to spend time on managing budget cuts rather than improving standards for our school children.
	I make no apology for wanting to avoid that situation. This year 18 education authorities failed to pass on the increase in education SSA to their education budgets. We would not take action against all of those authorities. Many achieved reasonable increases in their school budgets in spite of their failure to passport. But some did not: in one the increase in school budgets was only 2.4 per cent. That is not enough to meet the teachers' pay award, still less to increase school standards. It is that very specific sort of problem that we want to address with the reserve power. I urge noble Lords to withdraw this amendment; it would be a vote in these exceptional circumstances to lower school budgets.
	With regard to schools forums, the consultation exercise which we launched in May has reached its end and we have been able to consider the results. There were just under 200 responses. One thing that was immediately apparent was general support for the concept behind schools forums—that of partnership and consultation on the management of the schools budget to be created under Clause 42. So we believe that we were right to put schools forums into the Bill and right to persist with them. In the words of one governing body,
	"the establishment of a schools forum on a statutory basis is absolutely necessary as a part of the new framework of school funding and it would be a major breach of faith if the proposal were to be dropped".
	The debate on schools forums has centred around two main issues; that is, the functions of the forums and the way in which they have been constituted. Having considered the responses to the consultation exercise, we do not believe it is necessary to make any changes to the proposed functions of the forums. Though respondents naturally had different views on the details, there was a fair measure of agreement that the four main functions we envisage—consultation on the school funding formula; advising on specified issues in relation to the schoolsbudget; advising on contracts; and, finally, making decisions on the delegation of a very limited number of expenditure items—are the appropriate tasks for schools forums. It is the last of those which has perhaps aroused most anxiety.
	I want to repeat that this is a very limited decision-taking role: there is no intention to extend it, and I emphasise that the forum will not—I repeat, will not—have any control over the amount of expenditure on specific items or the total size of the schools budget. Many LEAs expressed reservations about this power and we shall consider carefully the details of its operation.
	In considering the results of the consultation exercise we have also looked at what has been said about the way in which forums are to be constituted and are to function. It is on this that a much greater divergence of opinion is evident. Although, as I said, nearly all respondents support the principle of schools forums, about half expressed doubts about their introduction in the form envisaged in the consultation paper, with a nationally determined framework for membership.
	There was considerable concern that existing local arrangements which have worked well—a point put forward by the noble Baroness, Lady Blatch—and in some cases been commended by Ofsted, would be replaced by forums and local partnership would not be helped. In some areas there is the prospect of duplicated consultative arrangements. What is wanted by a lot of respondents, including most LEAs, is much more flexibility to order schools forums in a way which suits local circumstances and takes account of existing bodies. I acknowledge that that concern has been expressed in this House, and indeed in another place.
	We do not propose any amendments to the Bill in consequence. Forums will still have schools members and non-schools members. However, I am able to announce some significant changes, which respond particularly to concerns raised in this Chamber, notably by the noble Baroness, Lady Blatch. We have taken a hard look at the regulations governing the way forums are to be constituted—circulated in draft—and we now intend that when they are made they should give much more discretion to authorities. They would have to include both governors and head teachers but the balance would be at LEA discretion and the election method locally determined. The minimum size would be raised but there would be no maximum; and there would be a requirement to ensure exact proportionality between school phases. The maximum percentage of non-schools members would be reduced to 20 per cent, and that could include elected members of the LEA. The LSC would only have observer status. The quorum requirement would be relaxed a little. Costs would be charged to the schools budget but other provisions on costs would be settled locally.
	We would of course wish to give guidance on a range of issues but those changes would enable many LEAs to transmute local bodies into statutory forums; where there is no suitable body already, it could be created to suit local circumstances. I believe that that meets the concerns of the noble Baroness, Lady Blatch, that good existing local practice is not damaged by this provision.
	Finally, many LEAs have said that they are concerned about timescale. We therefore intend that the date for implementation be put back to 15th January 2003. That would still leave scope for forums to be involved in discussion of budgets for 2003–04, and in any case the changes I have outlined above will make implementation easier.
	I hope that from what I have said and the changes we are proposing, that we are demonstrating that we are ready to listen and make changes. Schools forums are still an integral part of our plans for the new funding system; we want them to work and so we are taking a pragmatic view of what is needed to make them work. I hope that in the light of what I have said the noble Baroness will feel able towithdraw her amendment.

Baroness Walmsley: My Lords, I thank the Minister for her answer. On Amendment No. 22, unfortunately it is still a gross offence to suggest that the Government should be able to tell LEAs how they should divide their funding and I am still not happy with her answer. On Amendment No. 23, though the reserve powers would not often be used, unfortunately they still exist and may be used.
	Turning back briefly to Amendment No. 22, though we are in favour of transparency, that is not the major issue. The involvement of schools forums at all, being unallocated, makes us unhappy with Clause 40. I am grateful to the Minister for the sweeping changes she is suggesting to the composition of the schools forums. However, she has not been able to address our fundamental problem; that is, that they are unelected and unaccountable. I shall move Amendment No. 24 when we come it. But at this point I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 41 [Power of Secretary of State to set minimum schools budgets]:
	[Amendment No. 23 not moved.]
	Clause 42 [Schools forums]:

Baroness Walmsley: moved Amendment No. 24:
	Leave out Clause 42.

Baroness Walmsley: My Lords, I wish to test the opinion of the House. I beg to move.

On Question, Whether the said amendment (No. 24) shall be agreed to?
	Their Lordships divided: Contents, 161; Not-Contents, 136.

Resolved in the affirmative, and amendment agreed to accordingly.
	Clause 45 [Admission Forums]:

Baroness Blatch: moved Amendment No. 25:
	Page 30, line 9, after "shall" insert "if requested by a majority of governing bodies of maintained schools in their area".

Baroness Blatch: My Lords, I shall be brief. If admission forums are thought to be a good idea by schools in an area and a majority of schools deem that there should be a forum, they should determine whether to have one. They should not be imposed on every local authority because many already have perfectly workable and acceptable arrangements. I beg to move.

Baroness Ashton of Upholland: My Lords, we debated the amendment both in Committee and on Report. Of course, I am happy to explain our views again. We want the school admissions process to be even better for our parents and children. Our proposal for mandatory admission forums is one of the ways that we know will help to achieve that aim.
	We strongly believe that every area will benefit from having a forum and that the forum's role will be valuable. I make clear to the noble Baroness, Lady Sharp, that I am here talking about admission forums. Many people have voiced the view that admission forums would have greater impact if every area had to have one and admission authorities were required to have regard to their advice. There was strong support for mandatory admission forums among local education authorities. In consultation on school admissions, 91 per cent were in favour of them to some extent. Schools were also strongly in favour—83 per cent of head teachers agreed with them to some extent.
	We are building on the base established by those education authorities that have already set up successful admission forums by providing for mandatory admission forums with a clear and influential role. We believe wholeheartedly that mandatory admission forums will improve the admission process. They will ensure real discussion and consensus between the key admission partners in an education authority area, which is important. We do not want every governing body to have to debate, vote and then make a request for a forum to be set up when we have already established through consultation evidence of support for them. On that basis, I hope that the noble Baroness, Lady Blatch, will decide to withdraw her amendment.

Baroness Blatch: My Lords, if the Government believe in imposition, duplication, incurring greater cost and unnecessary time and energy being used on the proposal, so be it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Ashton of Upholland: moved Amendment No. 26:
	After Clause 64, insert the following new clause—
	"ARRANGEMENTS FOR THE ADMISSION OF PUPILS TO ACADEMIES
	After section 85A of the School Standards and Framework Act 1998 (c. 31) there is inserted—
	"85B FUNCTIONS OF ADMISSION FORUMS IN RELATION TO ACADEMIES
	(1) Regulations may authorise or require an admission forum established by a local education authority under section 85A to give advice to the governing body of any Academy in the authority's area on any matter corresponding to a matter prescribed under subsection (1)(b) of that section.
	(2) The governing body of an Academy shall have regard, in conducting the Academy, to any relevant advice given to them by an admission forum by virtue of subsection (1).""

Baroness Ashton of Upholland: My Lords, it has always been our intention that academies should be required to take part in statutory admission forums and to have regard to their advice by their funding agreements. As I described, we have already put in place robust arrangements to ensure that academies will be inclusive schools and that they will agree their admission arrangements in partnership with education authorities and other admission authorities.
	On Report, some noble Lords favoured putting those arrangements on an even more formal basis. As I said, this would in any case be covered in schools' funding arrangements, but we agreed to make the provisions more transparent and to strengthen them by introducing the amendment. It will place a statutory duty on admission forums to promulgate their advice to academies as well as to maintained schools within their area. It will also place a statutory duty on the governing body of an academy to have regard to such advice, which will be in addition to its contractual duty to have such regard through its funding agreement. I hope that noble Lords accept the amendment. I beg to move.

Baroness Sharp of Guildford: My Lords, I thank the Minister for tabling the amendment, which substantially meets our concerns about the role of academies in relation to admission forums. As she said, it makes it absolutely clear that academies will participate in admission forums and take their advice. We are delighted about that. Although we understand why, we are sorry that city technology colleges cannot also be included. We understand that they are totally independent schools, but we should have liked them to have been included. We understand that the Minister will encourage them where possible to participate in local admission forums as though they were members. We are delighted by the amendment and thank the Minister very much.

On Question, amendment agreed to.
	Clause 70 [Proposals relating to sixth forms]:

Lord Davies of Oldham: moved Amendment No. 27:
	Page 48, leave out lines 8 and 9 and insert—
	"(b) with a view to promoting one or more of the relevant objectives, or
	(c) if—
	(i) they are made in addition to proposals relating to education or training other than in schools, and
	(ii) the combined proposals are made with a view to promoting one or more of the relevant objectives."

Lord Davies of Oldham: My Lords, in moving the amendment I shall speak also to Amendments Nos. 28 and 29. This group of amendments fulfils the commitment that we made during debate on Report on the Learning and Skills Council's powers in relation to school sixth forms. On Report, I explained how the powers in Clause 70 will help to support the Government's agenda for a flexible, coherent and diverse 14 to 19 phase of learning. In particular, it will ensure that a single body—the LSC in England or the National Council for Education and Training in Wales—can lead local discussion and consultation on developing local patterns of 16 to 19 provision to ensure that all young people have access to a wide range of high quality provision that meets their needs and aspirations.
	On Report, I also acknowledged that the broad terms in which Clause 70 is drafted reflected too little of the Government's clear intention that the new LSC powers should be focused on improving achievement and opportunity for young people. The amendments address that concern.
	Amendments Nos. 27 and 28 remove from the Bill the delegation to regulation of the circumstances under which the LSC and the NCETW can make sixth form proposals, other than in following up an area inspection. In its place, the amendments substitute a condition that proposals may be published only if, either on their own or when combined with other proposals relating to education or training, they are made with a view to promoting relevant objectives.
	Amendment No. 29 specifies those objectives. They are: an improvement in achievement of 16 to 19 year-olds; an increase in 16 to 19 participation; and an expansion of the range of teaming opportunities open to 16 to 19 year-olds. Taken together, the amendments provide a description of the objectives that must underpin any proposals for local 16 to 19 provision that include reorganisation of school sixth forms in the absence of an area inspection. They meet the Government's intention of ensuring that the LSC may act to improve the quality of and access to 16 to 19 learning in an area.
	At the same time, they also reflect the concerns of, and give a clear reassurance to, those who have feared that the power might be used primarily to pursue other purposes, for instance relating to the relative costs of otherwise effective provision or the management of surplus. I beg to move.

Baroness Sharp of Guildford: My Lords, I rise to speak to Amendments Nos. 30, 31 and 32, which are amendments to Amendments Nos. 27, 28 and 29.
	The purpose of the three amendments is self-explanatory. They are intended to ensure local accountability in relation to sixth forms. The government amendments do not go quite far enough in that sense, although we are extremely grateful to the Government for the degree to which they have listened to the points that we made in Committee and, in particular, on Report. We are grateful to them for tabling the amendments but should like to tease the matter a little further.
	The amendments are intended to ensure that the planning of the Learning and Skills Council or the National Council for Education and Training in Wales is consistent with locally agreed plans—in particular the education development plan and the school organisation plan. The aim is to ensure that the Learning and Skills Council will not close a school sixth form solely because of its subjective views about the quality of post-16 provision. It is also important that the voice of the sixth form is heard in discussion about future provision.
	The relevant objectives in the government amendment introduce an element of subjectivity. It is a matter of judgment whether provision is improved if it is provided in a school or in a further education college. The LSC proposals must take account of locally consulted plans—plans agreed by people who know the students and their needs. Local people will know what is suitable to the requirements of post-16 students and will have already debated and agreed plans through their education development plan and school organisation plan. It is important that there is not another level of planning that is not tied into the main local education plan. Obviously, one cannot expect the Learning and Skills Council's plans to be tied all that well into local plans. They exist at a higher regional or national level. There must be a link between two such important plans, stemming from the work of teachers and the LEA. We need a little more linkage between the work going on locally and the decisions made by the LSC.

Lord Davies of Oldham: My Lords, I am sorry that the original amendments have not satisfied the noble Baroness, Lady Sharp of Guildford. I share her concern to ensure that local 16-to-19 planning is coherent and that the LSC works in partnership with LEAs, school organisation committees and other local bodies. To achieve that, it is vital that any LSC proposals for 16-to-19 provision work with the grain of existing provision and school planning, if that is the best way in which to deliver better opportunities and higher achievement. There is not a great deal between the Government and the noble Baroness on that issue. I can assure your Lordships that, in the guidance and regulations that will accompany the new LSC power, we will set out a framework to guarantee that those concerns are met. We will ensure that all local interests are fully consulted in the development of LSC proposals. The noble Baroness said that that should happen.
	I differ from the noble Baroness, however, inasmuch as I think that her amendments would introduce a degree of rigidity into the situation. We recognise, of course, that there should be reference to the local situation and a relationship to the school organisation plan. However, the amendments are misguided in seeking to tie the purposes for which the LSC may make proposals so closely to the plans for school provision already put in place by the LEA or the school organisation committee. That goes well beyond the obligations placed on the proposers of other types of school reorganisation and on SOCs. Our guidance to school organisation committees specifically allows proposals to differ from the school organisation plan to reflect, for instance, unexpected circumstances. It seems a little odd that the obligations on the LSC should be more restrictive and more onerous.
	The Government's amendments will ensure that any proposals from the LSC must improve achievement, opportunities or participation for young people. The amendments would qualify those objectives and stifle local innovation by requiring any LSC proposal that involved school sixth forms to conform to the existing plans, no matter what changes in circumstances or fresh thinking might have taken place locally since those plans were drawn up.
	My case is straightforward. I understand, of course, the noble Baroness's emphasis on local consultation. We share a view of what the LSC is meant to achieve, but her amendments to my noble friend's amendments would restrict the LSC unnecessarily. I hope that, on the basis of those assurances, the noble Baroness will decide not to press her amendments.

On Question, amendment agreed to.

Lord Davies of Oldham: moved Amendment No. 28:
	Page 48, leave out lines 14 and 15 and insert—
	"(b) with a view to promoting one or more of the relevant objectives, or
	(c) if—
	(i) they are made in addition to proposals relating to education or training other than in schools, and
	(ii) the combined proposals are made with a view to promoting one or more of the relevant objectives."
	On Question, amendment agreed to.

Lord Davies of Oldham: moved Amendment No. 29:
	Page 48, line 15, at end insert—
	"( ) For the purposes of this section, the following are "relevant objectives"—
	(a) an improvement in the educational or training achievements of persons who are above compulsory school age but below the age of 19;
	(b) an increase in the number of such persons who participate in education or training suitable to the requirements of such persons;
	(c) an expansion of the range of educational or training opportunities suitable to the requirements of such persons."

Lord Davies of Oldham: My Lords, I beg to move.

Baroness Sharp of Guildford: moved, as an amendment to Amendment No. 29, Amendment No. 30:
	Line 6, at end insert "consistent with the Education Development Plan"

Baroness Sharp of Guildford: My Lords, I am grateful to the Minister for listening to what I had to say. The key issue is that the matter should go down in the guidance. The Minister will recognise that the amendments probe the matter a little further than his amendment. We have no intention of pressing our amendment, but we did intend to get a more specific statement that there would be a positive link between the Learning and Skills Council and the local planning structures. It is important, and I am grateful to the Minister for the assurance that he gave. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 31 and 32, as amendments to Amendment No. 29, not moved.]
	On Question, Amendment No. 29 agreed to.
	Clause 120 [Power to prescribe pay and conditions]:

Lord Lucas: moved Amendment No. 33:
	Page 76, line 2, after "teacher" insert "or a member of the management team"

Lord Lucas: My Lords, Clause 120(3) defines a school teacher for the purposes of the clause. Clause 120(4) says that a head teacher is also a school teacher. I understand that that is required because some of the conditions under Clause 120(3) may not be met in the case of a head teacher.
	When we discussed the matter in Committee, I quoted the example of the head teacher with the luxury of six non-teaching deputies who was thus able to take a holiday in the middle of term. The characteristics of a head teacher that mean that he or she does not come under Clause 120(3) would also mean that non-teaching deputies did not come under that subsection. I propose the amendment to put that right or, at least, to find out that I do not need to put it right. We must make sure that non-teaching deputies qualify as teachers for the purposes of the clause. I beg to move.

Baroness Ashton of Upholland: My Lords, I must begin by apologising to the noble Lord, Lord Lucas, for the fact that my letter of 7th May to him did not fully cover the point that he made in Committee on 2nd May. Then, he said:
	"It is not clear that the definitions in Clause 118(3)(b) and Clause 129(1) would apply to a head teacher or member of senior management who was not actually teaching."—[Official Report, 2/5/02; col.901.]
	The clauses in question are now Clauses 120 and 131, as the noble Lord said. My letter was written in the context of the debate at the time, which concerned a set of technical government amendments to secure consistent references in the Bill to teachers employed by schools or LEAs. I recognise that I did not address in full the point that he now raises, and I apologise to him for that. I hope that I can satisfy him about that now.
	In general, a person must be paid as a teacher if he or she has qualified teacher status, is employed by the school or LEA, as appropriate, and—crucially—is required by contract to carry out the work that is to be specified under Clause 131; namely, the core teaching duties. That means that, in general, only qualified teachers who are required to carry out core teaching duties are entitled to be paid as qualified teachers. Clause 120(4) ensures that the head of a maintained school is subject to the pay and conditions provisions, whether or not he or she is contracted to carry out the core teaching duties. As the noble Lord said, the reason for the provision is that some heads do not do any teaching. If they are employed on the basis that they are not required to carry out the core teaching duties, they should still be subject to teachers' pay provisions.
	I fully understand the concern that other school managers, such as deputy or assistant heads, might not meet the criteria and would therefore not be required to be paid according to national pay and conditions agreements. I hope that I can reassure the noble Lord on that point. However, the difficulty with the amendment is that, in referring to the management team, it catches bursars as well as deputy and assistant heads. That would, of course, require schools to pay their bursars under the school teachers' pay and conditions document. I know that the noble Lord would recognise that to represent an undesirable loss of flexibility. There is no simple technical means of resolving that difficulty, as bursars may have qualified teacher status even though they have given up teaching.
	Having set that out, I turn to the substance of the issue. We certainly do not intend that schools should be forced to pay non-teaching deputy and assistant heads outside the pay document. That will not happen. Many deputy and assistant heads have some timetabled teaching and will automatically be caught by the provisions. All are qualified teachers and are, of course, currently employed under national pay and conditions agreements. Their contracts of employment will, in almost all cases, refer to a requirement to carry out core teaching duties, even if that is, in some cases, only occasionally.
	A deputy or assistant head who does not, in practice, carry out the core teaching duties will not be excluded from the requirement to be paid on national pay and conditions. The contractual duty to, for example, cover classes, where necessary, under the direction of the head will be sufficient to ensure that they are captured by the provisions.
	We have two key objections here and in Clause 131. First, we want to ensure that, subject to specified exceptions, core teaching work is carried out by qualified teachers and that they are entitled to be paid as such. Secondly, we want to ensure that schools do not lose their flexibility to deploy staff according to local circumstances, subject to the protections that Clause 131 gives to qualified teacher status. Thus, those who are not teaching are nevertheless still required under their contracts to teach if need be, and therefore are covered.
	I hope that, on the basis of my remarks, the noble Lord will feel able to withdraw his amendment.

Lord Lucas: My Lords, I am grateful for that explanation. I hope that it will work in practice. No doubt at some point in the future we shall find someone who will trip up on this technicality, but I do not suppose that it is much to worry about. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Clause 131 [Requirement to be qualified]:

Baroness Blatch: moved Amendment No. 34:
	Page 82, line 1, after "teacher," insert—
	"( ) is a teaching assistant under the direction and the direct supervision of a qualified teacher,"

Baroness Blatch: My Lords, I shall be brief. I am still fishing for a proper definition of a "teaching assistant". I am trying to work out, having read through the record and checked the correspondence, what is the difference between a teaching assistant today and a teaching assistant under the new arrangements. Furthermore, what is it that simply cannot be done now that will be facilitated by this part of the Bill?
	Some confusion arose when I tabled this amendment on Report. The noble Baroness thought that I was referring to any person working under the direction and/or the direct supervision of a qualified teacher. That could include the caretaker, the groundsman and the cleaners. In fact I refer here only to "teaching assistants". Rather than be used as substitute teachers, which is one of the fears expressed by professional teachers, they should be able to work as teaching assistants under the direction and the direct supervision of a qualified teacher. I beg to move.

Baroness Ashton of Upholland: My Lords, I begin by apologising to the noble Baroness for the numbering on the new policy statement I sent to her. That numbering does not reflect the latest version of the Bill. References in the statement to Clauses 128, 129 and 40 should now read Clauses 130, 131 and 43. There was no intention to mislead the noble Baroness. The statement was written at Report stage and I would not want her to think that I had not picked up the error.
	Perhaps I may turn first to the technical implications of the amendment and then seek to address the concerns of the noble Baroness. I think that she will accept that there are some technical difficulties because we do not want to restrict local discretion and appropriate flexibility in the use of teaching assistants in schools. The words "under the direction of" and "direct supervision of" are not as clear as perhaps we would need if we were to accept the amendment. Furthermore, as the noble Baroness herself pointed out, staff to whom she was not referring such as the caretaker right through to the deputy head teacher would be captured by the terms of the amendment.
	I have checked the position very carefully. The words "direct supervision" mean, in practice, that teaching assistants would be unable to undertake any specified teaching work without the presence of a qualified teacher. I shall cite an example. The noble Baroness will be well aware that experienced teaching assistants may on occasion take a group of children out of the classroom. A visit to the library could provide some appropriate work on literacy. Many situations that currently form a part of everyday teaching in schools would become questionable if we were to accept the amendment.
	Lessons prepared or devised by qualified teachers could not be delivered in any part or in any way by a teaching assistant without a qualified teacher being present. However, we know of circumstances where schools want to be able to ensure that qualified teachers set the work, although perhaps a teaching assistant would be in the classroom while the qualified teacher was outside preparing for the next part of the work. I am sure that we would not wish to interfere with those arrangements. Indeed, part of the aim of the Bill is to ensure that we understand those differences. The proposed level of supervision would not be appropriate in all cases and thus would limit the scope of teaching assistants to support qualified teachers.
	The noble Baroness referred on Report to teaching assistants in special schools who over the years may have gathered a great deal of experience of working in the classroom with children with special needs; indeed, they may well be more experienced and have greater know-how than newly qualified teachers coming straight from college. We want to ensure that such experienced teaching assistants are able to work with children in an appropriate manner, even if a qualified teacher is not present in the same room.
	The term "teaching assistant" is not otherwise defined in primary legislation and we believe that the amendment would create a distinction between them and other unqualified persons, to whom the noble Baroness referred. Teaching assistants are a heterogeneous group of persons, some of whom will be experienced school staff. Others may not have previous relevant experience of the learning environment. It is not possible comprehensively to define a "teaching assistant". Therefore, placing all teaching assistants under a direct supervision requirement would be inflexible and would leave schools in a kind of straitjacket. There would be no discretion to recognise the skills and experience of a particular individual. In addition, we do not want to tie the hands of qualified teachers by placing on them a daily function of directly supervising teaching assistants in the way specified in the amendment.
	We seek to add clarity so that schools understand the position with regard to working with teachers and teaching assistants. We must recognise that in our schools there are adults who come from different backgrounds, some of whom will be qualified and some unqualified. On Report we discussed at length particular individuals, such as those from overseas, who would fall into a certain category. I hope that the policy statement reflects what we are trying to achieve here; namely, to recognise that it is difficult to put a specific definition on a teaching assistant that would not rule out one or other group that is making a real contribution to our schools. Some may be more experienced than others and some may have special skills when working with particular groups of children.
	I hope that, along with the revised policy statement, I have been able to allay the fears of the noble Baroness and that in the light of these explanations she will feel able to withdraw her amendment.

Baroness Blatch: My Lords, I have to admit that I am still no wiser as regards what it is that cannot be done now by a teaching assistant that will be enabled by the Bill. I have to say that, out in the schools, I do not detect a concern about the use of teaching assistants. What I have detected is a sense of confusion and a suspicion with regard to exactly what it is the Government mean by "changing" the nature of teaching assistants.
	However, we shall see what works out in practice. In the hope that the fears that have been expressed by teachers have been allayed, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendment No. 35 not moved.]
	Clause 203 [Application of Part 5 of Education Act 1996 to nursery education]:

Baroness Blatch: moved Amendment No. 36:
	Leave out Clause 203.

Baroness Blatch: My Lords, in returning to this matter I wish most warmly to thank the noble Baroness for writing to me. However, I have to say that, if representatives of the Plain English Society are listening, then I wish to read out one paragraph of the letter to them:
	"Chapter 3 of the 1996 Act as originally drafted concerned religious education—one of the elements of course of the basic curriculum. So the position in 1996, as with the National Curriculum, because of section 410, was that this chapter did not apply to nursery classes and nursery schools. Chapter 3 was however largely replaced by the School Standards and Framework Act. In order to replicate section 410 in this respect in the Bill, we included an exemption for nursery classes at clause 76(2)(a) (nursery schools not in any case being covered by the basic curriculum as they are not 'maintained schools' for purposes of this section). We also amended the relevant parts of the School Standards and Framework Act (at paragraphs 103 and 104 of Schedule 21) to cross reference this to the definition of the basic curriculum which is now to be found at clause 78 of the Bill instead of in the 1996 Act. So religious education still does not apply to nursery classes or nursery schools".
	In a sense, that paragraph encapsulates my concerns. The Government want to do one thing: they want to add a foundation stage to nursery education to make it a statutory part of the national curriculum. While no one argues with that—indeed, I believe that it has been welcomed—perhaps I may put an interesting question to the noble Baroness. Children below the age of five years are not of statutory school age, but now we are to introduce a statutory stage of the national curriculum. How will that square in law with regard to children who are not of statutory school age?
	I know that we shall be discussing this in a few moments, but given that Montessori schools do not cover everything suggested by the Government at nursery school age, what impact will the foundation stage have on such schools? I have mentioned Montessori schools, but the question applies equally to any other nursery school not wishing to adopt the new system.
	The whole of Part 5 of the 1996 Act has been transposed into this Bill in order to achieve one aim. A power could have been taken by the Secretary of State simply to add a foundation stage to the national curriculum for nursery school-age children. Part 5 did not have a foundation stage for the nursery school national curriculum. I find this very puzzling. As I say, the paragraph I have quoted epitomises the difficulty that not only I but teachers have with this kind of legalese and gobbledegook when these missives come down from on high. I beg to move.

Baroness Walmsley: My Lords, I confess to being similarly puzzled by this gobbledegook. Clearly some of it is nonsense. Like the noble Baroness, Lady Blatch, I cannot see why the Government have had to do it this way. I, too, am puzzled as to why there is a statutory foundation stage for a non-statutory age group for attendance at school. We live in hope that the Minister will be able to clarify the situation.

Baroness Ashton of Upholland: My Lords, the noble Baroness, Lady Blatch, has spent much longer than I have working with those who ensure that our legislation does what it is meant to do. Having had the paragraph read back to me, I apologise for it. It made sense when I read it to myself—I did of course read the letters—but I understand the difficulty that the noble Baroness has with it.
	I shall try to put the issue on the record. I was concerned at the press reports that I saw over the weekend and it is important that we should be clear about this. I hope that my explanation will be in plain English. I try always to speak plain English in your Lordships' House.
	Clause 203 of the Bill does not in any way change the duties of nursery schools or nursery classes with respect to sex education and religious education or in any other substantive way except in regard to the policy objectives that we have set out in relation to the foundation stage.
	My brief states that the noble Baroness will have received a letter and that it was as clear as I believed I was. I shall refrain from commenting on that. There is some doubt in the noble Baroness's mind—as there was in a fanciful newspaper report—and so I repeat that there will be no requirement for nursery-aged children to have sex education. That is completely ludicrous. The Education Act 1993 first introduced the duty for secondary-aged pupils to have sex education. That is not changed in any way by the Bill.
	Nor does any school have a duty to make a statement about sex education that did not have such a duty before the Bill. The duty never applied to nursery schools; it will not do so as a result of the Bill. Nor are the duties with respect to religious education changed in any way by this legislation.
	We have two main policy aims in the Bill with regard to the curriculum. First, to create the flexibility necessary to take forward the 14-19 agenda; secondly, to introduce the foundation stage as a statutory part of the national curriculum. We are also ensuring—the noble Lord, Lord Lucas, who is no longer in his place, would be pleased by this—that schools are not prevented by legislative inflexibility from accelerating pupils through key stages.
	In addition, we have a technical legal aim—that is, to separate out the provisions relating to the national curriculum in England and the national curriculum in Wales in order to clarify for users of the statute book what had become quite a muddled set of sections because of the differences between Welsh and English schools. We sought no other changes to the law other than to implement these aims. The repeal of Section 410 was necessary to implement the foundation stage but, apart from enabling the implementation, we replicated its effect.
	Let me set out the legal position, put it on the record and, I hope, clarify it in plain English. A great deal of Part 5 of the Education Act 1996 has already been or will be repealed by the Bill. Part 5 of the 1996 Act originally had four chapters. Chapters 1 and 2 dealt with the national curriculum, which we repeal and re-enact here. Because we are adding the foundation stage it is necessary that these re-enacted provisions now apply to nursery education.
	Chapter 3 of the 1996 Act as originally drafted concerned religious education, which is one of the elements of the basic curriculum. However, Chapter 3 was replaced by the School Standards and Framework Act, so we have amended the relevant parts of that Act to ensure that religious education still does not apply to nursery classes or nursery schools.
	The collective worship provisions were changed in 1998. The effect of Section 70 of the School Standards and Framework Act is that children in a nursery class at a primary school have to take part in an act of collective worship while children at maintained nursery schools do not. This has been the law since 1998 because we do not believe that children in a nursery class should be treated differently from the rest of the school. We have not changed that position in the Bill.
	Most of the remaining provisions of Part 5 of the 1996 Act are incapable of applying to nursery education. The provisions in regard to SACRE, which noble Lords will know advises the local education authority on collective worship and RE, apply to the extent that I have explained in relation to collective worship. Public examinations are clearly irrelevant.
	The provisions that prevent political indoctrination and secure balanced treatment and the provisions in relation to information and complaints apply to maintained schools and thus to nursery classes within such schools. This is consistent with wanting to treat the classes as part of the whole school. It is clearly right that if we treat the foundation stage on a par with other stages of the national curriculum these provisions should also apply.
	Clause 81 of the Bill clearly sets out the six learning areas of the foundation stage curriculum and has been warmly welcomed, as the noble Baroness, Lady Blatch, said. If the government are funding it, the nurseries must provide the foundation stage. No child has to have a nursery education, but if the child is funded by the Government the nursery must provide the foundation stage.
	If there had been a simple way of doing this we would have taken that course. This is the way that we had to do it. I hope that when noble Lords and others read in Hansard what does and does not apply, they will see that what we have done is exactly what the noble Baroness, Lady Blatch, wants us to do—that is, to bring in the foundation stage curriculum, which the noble Baroness said she warmly welcomed, and to ensure that inappropriate matters are not applied to it. In the light of that explanation, I hope that the noble Baroness will feel able to withdraw her amendment.

Baroness Blatch: My Lords, the confusion has arisen because of the application of Part 5 to nursery schools. I believe that, given that the foundation stage is not included in Part 5, it would have been possible simply to insert a power to introduce it.
	The Minister did not mention Montessori education. I assume that as long as the Government are not paying for Montessori education this provision will not apply.
	My record in the department is fairly miserable in the sense that I was always a thorn in the side of officials and pressed them to use, where possible, plainer English. I failed miserably and nothing appears to have changed. They still get their way.
	My only real success was bringing together, against incredible opposition from the department, a Peer with whom I argued vociferously on the Floor of the House and parliamentary counsel. I said, "Perhaps parliamentary counsel can convince you that this is the answer". Within five minutes my noble friend Lord Renton, who is not in his place, won the day and parliamentary counsel changed the legalese in the Bill. So occasionally it can be done.
	Sex education is not banned in primary schools; it is compulsory only in secondary schools. Therefore the application of Part 5 to this part of the Bill leaves open the possibility of that part of the Act being applied to nursery schools. So it is not surprising that at least some people have been fairly fertile in their imagination of what the importation of Part 5 could mean.
	I have taken this issue as far as I can. I hope that I have struck a blow for plainer English. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Schedule 4 [Admission arrangements]:

Baroness Sharp of Guildford: moved Amendment No. 37:
	Page 139, line 3, at end insert—
	"( ) In section 90 of the 1998 Act (reference of objections to adjudicator or Secretary of State) at the end of subsection (2) insert—
	"(2A) Where—
	(a) the admission arrangements have been determined by an admission authority under section 89(4), but
	(b) a parent wishes to make an objection about these arrangements,.
	that person may refer the objection to the local education authority which, after considering the objection, may refer the objection to the adjudicator.""

Baroness Sharp of Guildford: My Lords, I return to this amendment because I did not get a satisfactory answer from the Minister at Report stage and I wish to take the matter a little further. We have brought it back in a slightly amended form to take account of some of the points made.
	To remind your Lordships, the amendment is about giving more parental rights over admission arrangements and not only about the admission of a particular child. The amendment would give parents the right to appeal to the adjudicator, an independent body which can uphold an appeal and require a school's admission arrangements to change to reflect the law and code of practice on school admissions.
	The many years of experimentation by the Conservative government left a diversity of admissions practices, some of which were fairer than others. LEAs can appeal to the adjudicator but have been reluctant to do so in relation to the practices of particular schools because of a wish to work with schools and build a relationship with them—the schools have sometimes been grant-maintained, and therefore the LEA is anxious to build a new relationship with them, particularly after their reintroduction to the LEA framework following the 1998 Act. Parents have been left somewhere in the middle. The two cases I cited on Report—namely, of schools in Lewisham and Havering—came to light only because the parents concerned appealed to the ombudsman, because the LEA had not appealed.
	The adjudicator is preferable to the ombudsman for resolving such issues. The adjudicator has specialist knowledge of the specific area of school admission arrangements; the local government ombudsman covers all local services outside the health service. The adjudicator works to a fixed, tight timetable; the ombudsman carries out investigations over a much longer period of time. The adjudicator can direct changes to admission arrangements to bring them into line with the law; the ombudsman can only propose remedies. Neither has an appeal system except through judicial review. The adjudicator is the best way of resolving parental complaints.
	It is accepted that current primary legislation allows for secondary legislation to give parents the right of appeal to the adjudicator but that the Government are very reluctant to give parents such a right, and they are also reluctant to come forward with new regulations. The reason given is that there was little response from parents to the consultation on school admissions issued on 5th September 2001. In fact, the consultation did not ask directly whether parents' rights should be extended. It was noted in the consultation document that,
	"parents in groups of at least 10 can already make objections to the Adjudicator where admission arrangements include selection for some places, and that selection has been in place since the school year 1997–98 or earlier. We do not presently plan to extend objection rights further, but if you think we should please say so".
	The question asked—and all DfES consultation documents have constrained responses now—was Question 12:
	"Do you think rights to object about proposed admission arrangements should be extended in other ways?".
	The analysis of the responses to the consultation on school admissions did say that there had been little support to widen the objection further, particularly from voluntary-aided and foundation schools. But to some extent it is to be expected that both might wish to keep arrangements much as they were. In fact, 55 per cent of respondents disagreed overall with giving more parental rights—hardly an overwhelming majority. But at the start of the report it was stated that,
	"the majority of those responding to this consultation have a professional interest in education".
	Few responses—only 13 out of 416—were from parents. Elsewhere, the report states that the response rate,
	"is too small to draw any conclusions on parents' views".
	The answer, therefore, to the idea that "parents don't want it" is that very few parents have actually been asked. The meagre response rate to the constrained question to a professional audience is one of the three arguments advanced by the Government for not giving greater parental rights.
	The second argument advanced was that,
	"Any admission arrangements could potentially be challenged".—[Official Report, 19/6/02; col. 864.]
	It indicates that the Government are possibly somewhat afraid of parents taking action to ensure that they get the best education for their children. The objection given at that time was, as I said, that some way was needed of sifting such a challenge from parents and of making sure that it did not go directly to the ombudsman. The amendment tries to take account of government fears by requiring the LEA to listen to parental objections and if the LEA agrees with any parental objection to refer the matter to the adjudicator. That takes account of the Lewisham case, where, if the LEA had listened to parental concerns about the school's admission arrangements, the matter could have been resolved a couple of years earlier than it was. The local authority would probably not have been found guilty of maladminstration.
	The amendment may not be perfect, but it does try to take account of the Government's fears about giving parents a greater say in their local school system. It is up to the Government now to state whether they support parents in such situations. I beg to move.

Baroness Ashton of Upholland: My Lords, although I understand the intention behind the amendment, the difficulty is that it does not actually do what the noble Baroness wishes it to do. Referral of an objection to the adjudicator would be dependent upon the local education authority agreeing to do so—and it could well be that the LEA is the admission authority against whose arrangements a parent seeks to make objection. However, I hope that I can demonstrate that similar opportunities currently exist for parents to make their objections known.
	Parents can already make representations to their local education authority, either directly or to their local education committee via elected members. It is then up to the local education authority to consider those representations and to decide whether an objection to a school's arrangements is justified.
	As I have pointed out in previous debates, the issue of whether LEAs should take account of parents' complaints and representations was highlighted in the complaint about the Prendergast school in Lewisham and the finding that the school's practice of interviewing applicants was contrary to guidance. The ombudsman also said that the LEA was guilty of maladministration because it has neglected to object to the school's arrangements to the adjudicator, despite the fact that parents had made the school aware of this. We believe that this emphasises the greater responsibility that education authorities have to consider what is in the best interests of all children in their area.
	But governing bodies of individual schools should also consider the interests of their own pupils. Schools which are their own admission authority may already object to another's admission arrangements, and the Bill extends that right to the governing bodies of community and controlled schools. This may be a benefit where, for example, children attending a particular primary school are disadvantaged by a local secondary school's admission arrangements, perhaps because their school is not a named feeder school. Under the new provision, any governing body will be able to refer an objection to the adjudicator on behalf of its pupils and parents—not through the local education authority but directly.
	I believe that with the role of parent governors and with the governing bodies' interest in protecting and enhancing the children within their care, this is the right place to put our focus, and indeed the reason why we have brought forward the amendment. I hope, therefore, that the noble Baroness, Lady Sharp, will accept that the amendment does not do what she wishes it to do. We believe that individual governing bodies are best placed to do this. We shall, of course, look at this procedure and ensure that it is working well. My door is always open, and other Ministers' doors will be open, to further discussion after the Bill has completed its passage. I have set out the importance of the position and I hope that the noble Baroness will be able to withdraw her amendment.

Baroness Sharp of Guildford: My Lords, I am grateful to the Minister. Her response does meet completely what is required. Nevertheless, we have taken this proposal as far as we can. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Schedule 14 [Inspection of nursery education]:

Baroness Blatch: moved Amendment No. 38:
	Page 174, line 27, at end insert—
	:TITLE3:"Rights to require paperwork
	In paragraph 18 of Schedule 26 to the School Standards and Framework Act 1998 (c. 31) (rights of entry), in sub-paragraph (2)(b) for "which he requires" there is substituted "which he reasonably requires"."

Baroness Blatch: My Lords, among the other features of the Bill, there are two running themes: first, a massive extension of powers to regulate and control almost every aspect of school life, from the appointment of clerks to governing bodies to the setting of attendance targets for individual schools; and secondly, effective nationalisation of the nursery sector and its subjection to regulation by the department and by other public agencies. Is it any wonder that, with such a mentality running free in the department, regulators, inspectors and local authorities bombard nursery schools with demands for record-keeping and paperwork which are driving many good people to leave the profession?
	I welcomed what the Minister said on Report about efforts being made by Ofsted to restrict demands for paperwork on nursery schools. We shall await the practical outcome of that. But it simply does not tally with experience in schools, where there are almost daily reports of unreasonable demands for paper inspection. Only today, I had lunch with the deputy head of a nursery school who was in the throes of preparing for an inspection. She not only applauded the amendment; she went so far as to say that unless the burden is reduced nursery education will start to lose very good people.
	The Minister said that the amendment is unnecessary. Nursery schools are telling me a different story. They are crying out for some hint of understanding from the Government for their predicament. Even at this late stage, I hope that the Government will reconsider their resistance to the amendment. There can surely be no reason for resisting a specific reasonable test on paperwork, which, combined with incoherent, intrusive, and constantly changing departmental guidelines, is the major cause of complaint by nursery schools.
	I echo the comments made by my noble friend Lord Lucas on an earlier amendment. The amendment would provide an assurance of certainty to those who currently veer between fear and despair about the weight of paperwork required. In the name of nursery school teachers up and down the land, I ask the Minister to remember that every hour spent on unreasonable paperwork—and that is what I am talking about—is an hour lost to lighting the spark of learning in a young child. Please accept the reasonable test by accepting the amendment. I beg to move.

Baroness Ashton of Upholland: My Lords, during our previous debate on Amendment No. 38 the noble Baroness, Lady Blatch, placed great emphasis on the views of nursery schools and the world of nursery education on the burden of paperwork that they feel threatened by. As the noble Baroness knows, as Minister with responsibility for nursery schools, I am always in conversation with them to ensure that I get those messages. I am hearing loud and clear the messages that the noble Baroness is putting forward.
	I have taken comfort from what Ofsted has reported to me on the reductions in its demands for paperwork. However, we should not assume that more cannot be done to ease the burden of inspection. I shall continue to have a dialogue with Ofsted, as will other ministerial colleagues, on that issue.
	I acknowledge the danger that each new initiative to improve quality for young people can carry with it increased demands for paperwork that perversely might detract from the improvements that were intended. I assure the House that those are matters of great concern to me. Until recently I was the chair of governors at a school and I know well how schools perceive Ofsted and its demands. That small nurseries and playgroups offering nursery education feel threatened is entirely understandable. Some of the correspondence that I receive from nurseries highlights those issues.
	I reiterate that adding the word "reasonably" in this part of the legislation does not address this problem. The way forward—and this is what I am committed to in the early years and childcare part of my brief—is not to produce a law of dubious effect, but rather to engage in a dialogue that we need with the various stakeholders.
	I hope that it will be helpful to repeat the explanations I have given already as to why the amendment does not make good law. As a public body, Ofsted is already under a public law duty to act reasonably in all its dealings with schools, nursery settings and childcare providers. A specific requirement to act reasonably in one aspect of its dealings with the customers is unnecessary and, more importantly, could cast doubt on a general duty to act reasonably. That is why we believe the law should be left as it is. The duty of reasonableness is a public law duty applying to public bodies. The noble Baroness, Lady Blatch, would be right that others might be given specific duties of reasonableness. The general duty already applies to Ofsted.
	Paragraph 8(2)(b) of Schedule 26 to the School Standards and Framework Act 1998 already makes it clear that a nursery education inspector or a member of the inspectorate conducting or monitoring inspections should copy only documents that are required for the purpose of conducting or monitoring the inspection. I oppose the amendment not because I do not entirely support what the noble Baroness is seeking to do, but because we have tested the issue and found that it would be counterproductive because the duty of reasonableness already exists. The amendment would place that public duty in some doubt.
	For that reason and that reason alone, while accepting entirely the sentiments behind the amendment, I invite the noble Baroness to withdraw it.

Baroness Blatch: My Lords, I have done my best by the nursery schools that have contacted me. The Government have made this pledge. Unless there is a practical outcome, I am afraid this grave mistrust will continue. I take what the Minister has said. I believe her. I trust that something practical will now happen. We expect Ofsted to behave reasonably. Indeed, we shall be watching carefully that it does. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	Schedule 17 [Amendments of Part 5 of Education Act 1977]:

Baroness Blatch: moved Amendment No. 39:
	Page 180, line 15, at end insert—
	"(2B) In the case of maintained nursery schools or of funded nursery schools which are designated as Montessori schools, and where the principal or at least two senior teachers are holders of recognised qualifications from Montessori awarding bodies, the authority, in carrying out its functions under this section, shall do nothing that will require or advise schools or teachers to depart from principles and teaching methods that are appropriate to Montessori education and shall not insist on anything that is inappropriate to Montessori education."

Baroness Blatch: My Lords, Amendments Nos. 39, 40 and 41 are aimed at protecting the integrity of Montessori qualifications, Montessori schools and the Montessori system, against direction, or pressure to re-qualify or to modify qualifications and Montessori teaching practice in ways that are inappropriate to them.
	I have studied carefully the Minister's reply on Report, which I found more positive than the response from the noble Lord, Lord Davies, at an earlier stage. Perhaps that reflects a heightened degree of personal interest and, dare I say, sympathy on the Minister's behalf. I hope so, because I am convinced that a sensible solution can be found, but fear it will happen only if the Minister gives it her personal attention.
	There have been too many instances where small bodies—though the Montessori movement, making up 6 per cent of nursery education, is not so small—were seen as inconvenient by officials and told that they must fit a departmental model. Equally, I found a crisp "just sort it out" from the Minister could work wonders and would translate all the good intentions expressed at the Dispatch Box into reality. I hope that the Minister can assure your Lordships' House that that will be done.
	While I do not want to be party to negotiation across the Dispatch Box, I have five brief observations on our exchanges on Report, and ask the Minister to clarify points in those areas. First, the implication that only Montessori education in the United Kingdom is raising those matters with me is simply not true. Since I first agreed to raise those important issues I have been encouraged by support from a wide range of Montessori institutions—from national training providers to individual teachers. The Minister is being misled if she believes that concerns are confined to one body.
	Certainly Montessori Education UK has made some powerful and practical suggestions. It is the national standards body for Montessori education—a membership organisation which also has on its council the national co-ordinator of the Montessori Early Years Forum. Montessori UK has also acted as co-ordinator of meetings held by Montessori awarding bodies to agree a way forward on the qualifications issue. All those bodies were represented. A consensus view has been achieved. That has reflected both the concerns I set out at earlier stages, and the possible solution proposed.
	It is unacceptable to take the Montessori movement to task for saying that there have been too many awarding bodies, then, when those bodies come together with a co-ordinator, to say that Montessori UK is only one body of many. That is not the best way to engage the Montessori movement. I hope the Minister will put a stop to that prejudice from those who hold that view.
	Secondly, can the Minister give the assurance I sought on Report that information on Montessori qualifications and services will be included in future official lists and publications sponsored by the DfES? That would help to allay current suspicions that the movement is being marginalised by the department and the QCA.
	Thirdly, will the Minister respond specifically and unequivocally to the point that lies behind Amendment No. 40 and give an assurance that she failed to give on Report; namely, to state on the record that no Montessori qualified principal, teacher or manager, who is the holder of a Montessori diploma, will be required to re-qualify or get an additional qualification to continue their work in Montessori education? Will the Minister also confirm that in the view of the department a Montessori diploma is, and will be, full and sufficient qualification to serve as a principal, manager or teacher, in a Montessori nursery school?
	On Amendment No. 41 the Minister said on Report that there was no question of a direction to a Montessori body unless it was failing to comply with a condition of accreditation it had already agreed to. The Minister also said that,
	"no Montessori organisation has submitted any qualifications for accreditation".—[Official Report, 26/6/02; col. 1473.]
	With respect, that is putting the cart before the horse. The whole point of the present discussions is to explore whether a means can be found of grafting Montessori qualifications—robust, hard-won, long tried and tested as they are—to the Government's bureaucratic model without compromising their integrity and without sacrificing their principles.
	It is unreasonable to expect Montessori bodies to submit a model or to agree to a direction unless they can be satisfied on that point. That is why, unless the Minister can assure your Lordships' House that she will intervene to facilitate a solution, Amendment No. 41 is both relevant and important, although it may be that the matter could be addressed outside the Bill by direction from the Minister to the QCA.
	Finally in this context, on Report I referred to a possible solution in which the Montessori diploma might be linked to the Council for Awards in Children's Care and Education certificate of professional development in a way that neither compromised Montessori principles nor required the otiose study of a lower level of qualification. The Minister seemed sympathetic but said that it had to be pursued with the QCA and Ofsted. I understand that since then Ofsted has informally told the Montessori bodies that it is not within its remit to recognise individual courses or qualifications. It has passed the buck back to the department and the QCA.
	With respect, this sounds a right old bureaucratic merry-go-round. Perhaps that is inherent in the unnecessarily complex bureaucracy being set up by the Government and worsened under the Bill—or perhaps not.
	I return to the point at which I began. The tenor of our debates has been that the House sympathises with and respects Montessori schools, Montessori teachers and Montessori qualifications. They have gone on providing good early years teaching for generations despite the dead hand of nationalisation stepping in. When something works well, why cannot the department let it be? Can the Minister not issue a crisp, "Sort it out soon and positively", as I have suggested previously, and let these fine nursery schools and dedicated awarding bodies get on with their lives? An assurance to that effect would go a long way to easing worries in the House and outside. I beg to move.

Baroness Ashton of Upholland: My Lords, I repeat that nothing that the department or any agency is doing threatens Montessori education in any way. The foundation stage curriculum, which, as the noble Baroness said, has been widely welcomed, is designed to be flexible enough to accommodate a wide range of approaches to early learning, including Montessori.
	I am confident that a fully satisfactory way through will be found on the inclusion of the Montessori qualification in the national qualifications framework. As the noble Baroness said, we cannot do that across the Dispatch Box. It must be secured through constructive dialogue, which I understand as of today is under way between the QCA and the relevant Montessori bodies. A promising way forward has been proposed. Whether it succeeds depends on the detail, but whether in this way or another way I am confident that a solution will be found. I shall ensure that I keep a watch over what is happening.
	I repeat, we shall not do anything to endanger Montessori. A wide range of existing Montessori qualifications are acceptable to Ofsted for the regulation of day care.
	The aim of Amendment No. 39 is to ensure that Montessori schools are not prevented from teaching in a way that is consistent with Montessori principles and practices. I stress that the Bill ensures that providers of early years education such as Montessori schools will retain the flexibility, built into the foundation stage curriculum guidance, to plan learning experiences that are appropriate to the needs of the children, families and communities with whom they work.
	Amendment No. 40, which is the same as one tabled in Committee and on Report, is about whether Ofsted and the QCA are prepared to recognise existing Montessori qualifications from any of the Montessori awarding bodies in the UK. I recognise that some people in the Montessori world believe that the essence of their training might be lost if they had to shoehorn their provisions into the requirements of the national framework. Those fears are misplaced.
	First, I reiterate my support for Montessori education in this country. It has provided a distinctive ethos that has benefited thousands if not millions of children who have passed through Montessori nurseries over the years. We welcome the contribution that Montessori nurseries bring to the early years sector. We do not want them to be excluded in any way.
	Secondly, a range of Montessori qualifications have been endorsed by the Early Years National Training Organisation and are currently acceptable to Ofsted as meeting the requirements of the national standards for day care. The regulation of childcare by Ofsted is essential to ensure that parents can trust the safety and quality of provision. That regulation needs to respect the unique qualities of Montessori education. However, it is not appropriate for Montessori or any other approach to stand outside these frameworks. We have struck the right balance and by working with the Montessori sector we can continue to do so.
	I have a list of 37 Montessori qualifications that have been mapped at various levels for the purpose of guiding Ofsted inspectors and day care providers on what is needed to comply with the national standards. That should reassure those who fear that their Montessori qualifications somehow do not count.
	I have said that we shall review the national standards next year when we look again at the criteria that will guide Ofsted's decisions on day care registration. We have no intention of revising the national standards in a way that would disregard the valuable experience that Montessori professionals bring to the early years sector or endanger the ethos or viability of the Montessori sector.
	We are involved in a dialogue with the QCA, Ofsted and other organisations about the longer term—in particular about how to encourage a situation in which the national qualifications framework contains the comprehensive and inclusive range of early years and childcare qualifications. We are pleased that Montessori has been exploring with the QCA how best to ensure that people with its qualifications might be covered by the framework and that discussions are continuing. We want to encourage participation to achieve the outcome of a national qualifications framework that rationalises the plethora of qualifications and is acceptable to the sector as a whole. I welcome the way in which the various Montessori organisations have come together to work with the QCA. There is great value to the Montessori movement and to the early years and childcare sector in general in working together to develop qualifications that are part of a recognised framework.
	In summary, I reiterate that we applaud the work of the many Montessori nurseries across the country. We welcome the work that the various Montessori groups are doing with the QCA and others to bring their qualifications into the framework. More than that, I emphasise again that under the current national standards that Ofsted applies in its early years function a range of Montessori qualifications are acceptable to meet the qualifications requirement.
	Amendment No. 41 was also tabled on Report. I understand the noble Baroness's wish to ensure that the special characteristics of Montessori education are respected. The amendment is not necessary and it is not appropriate to limit QCA's power in relation to a specific awarding body in that way.
	The amendment primarily addresses the new power to direct, although it also touches on the conditions under which the QCA accredits qualifications. The power to direct is concerned only with accredited qualifications. It is designed to ensure the effective delivery of qualifications and the interests of learners expecting to take them if there has been a failure or a serious risk of failure by the awarding body. The power can be exercised only if an awarding body is failing to comply with a condition of accreditation. If a qualification has been accredited, clearly the awarding body must have agreed to conditions on accreditation. The power to direct was designed simply to ensure compliance with those conditions.
	It is not appropriate to tie the QCA's hands in the eventuality that at some point one or more Montessori organisations successfully seek accreditation and then fail to comply with the conditions that they have agreed to meet. For those reasons, it is important that the QCA is able to use its power. We should trust its professional and impartial judgment.
	I understand that some people in the Montessori world have worries, but they are misplaced. I am confident that the QCA will act professionally and with due regard to the unique attributes of Montessori provision in exercising its power. There is an open and constructive dialogue between the QCA, Ofsted and the Montessori awarding body, which will continue until a mutually acceptable way forward has been found. These discussions are promising. I shall write to the noble Baroness if she wants to know how they are progressing. I also commit to keep close to the issue and to keep the noble Baroness firmly in touch as we move towards what I am sure will be a satisfactory conclusion. On that basis, I hope that she will feel able to withdraw the amendment.

Baroness Blatch: My Lords, once again, I am grateful for the noble Baroness's encouraging answer. I hope that the confusion about to whom Montessori should talk—Ofsted, the QCA and/or the department—and where the right people are to further the debate will be cleared up. I do not know why the QCA should have powers over Montessori. As the noble Baroness said, only when matters have been agreed between them would Montessori bodies be tested for compliance. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.
	[Amendments Nos. 40 and 41 not moved.]

Baroness Ashton of Upholland: My Lords, I beg to move that the Bill do now pass. In moving the Motion I would like to say a few words of thanks to all noble Lords who have given so much time to the Bill and spoken during its passage through your Lordships' House. I am particularly grateful to my noble friend Lord Davies for his more or less continuous presence alongside me, his help and support throughout, his dry wit and his unerring ability to reach the heart of an argument. I am particularly grateful for his depth of knowledge and experience of the further education sector.
	I am grateful also to my noble friend Lord McIntosh, whose experience has saved me from having to learn a great deal of company law. His advice throughout has been enormously helpful. Similarly, I thank my noble friend Lady Farrington, whose knowledge of Wales and Welsh education has been thoroughly appreciated. Through her I thank all colleagues in Wales for their work.
	I thank my noble friends Lord Carter and Lord Grocott and all their colleagues in the Whips' Office. They have each been an invaluable source of advice and support and I am grateful to them.
	I turn to the Opposition Front Benches. I thank the noble Baroness, Lady Blatch, for the considerable part she has played in our consideration of the Bill. Debates have ranged far and wide and I have never failed to be impressed by the commitment and knowledge she brings to such a diverse range of issues.
	The noble Baroness, Lady Sharp, and the noble Baroness, Lady Walmsley, have been central to all our debates and I thank them for their constructive approach. It has been important to the Bill's passage that, although at times all the Front Benches have disagreed, debate has never been less than thoughtful and courteous. I am grateful to all noble Lords for that.
	I should like to pay tribute to a number of noble Lords who have played an important part in our debates. Your Lordships will not be surprised that I wish to thank in particular my noble friend Lord Peston, whose contributions have never been less than stimulating and who has ensured that we have never lost sight of the importance of principle in our debates. The noble Lord, Lord Lucas, has brought his expertise to bear with such good effect. I thank the noble Lord, Lord Dearing, whose great contribution to education in this country informs and lends weight to all his contributions.
	The noble Lord, Lord Alton, has throughout demonstrated his commitment to the better education of children in this country. I thank also the noble Earl, Lord Listowel, whose depth of commitment to the vulnerable and disadvantaged has kept those young people at the forefront of all our minds.
	The vital issue of special educational needs has been to the fore in our debates. I am particularly grateful to the noble Lord, Lord Rix, the noble Baroness, Lady Darcy de Knayth, and the noble Lord, Lord Addington, for making it so. We have spent considerable time on those issues during the Bill's passage and I hope that all noble Lords will agree it has been to good effect.
	I thank the right reverend Prelate the Bishop of Blackburn for his thoughtful and considered comments. The tone of his contributions has reflected the warm relations that exist between the department and the Church. I hope he will feel at the end of our considerations on the Bill that his glass is more than half full.
	Many other noble Lords have made important contributions to our debates. I think particularly of the noble Lord, Lord Northbourne, the noble Baroness, Lady Seccombe, the noble Baroness, Lady Howe, and my noble friend Lady David. I thank them and all other noble Lords who have contributed.
	This has been my first Bill as a Minister. The contributions of Members of this House more than anything have made it a fascinating and memorable experience for me. I also want to thank the Bill team that has worked with me. I have been extraordinarily blessed by such an incredible amount of talent vested in such a small group of people. It has been one of the most interesting experiences of my life to work so closely with such a talented group of people. They have steered me successfully away from many rocks.
	I also want to thank parliamentary counsel. She has been excellent and worked unstintingly on the Bill. I thank her not only for her technical work but also for the quality of her advice and the approach she has taken. I give her my warmest thanks.
	Finally, I thank the doorkeepers and all the staff of the House. We have sometimes kept them here at unearthly hours, but they have never failed to be cheerful, helpful and positive. I am grateful to them.
	The Bill is an important part of the Government's drive to raise standards. It signals the beginning of a second wave of reform, which we intend should be characterised by innovation and modernisation. We have now the best generation of teachers and the best ever results. Studies show that our young people are doing better than those in most other countries. We want to build on that and place greater trust in the informed professional judgment of our teachers and others on the front line. We want to support them to find new ways to innovate and raise standards.
	That is at the heart of the Bill. I commend it to your Lordships' House.
	Moved, That the Bill do now pass.—(Baroness Ashton of Upholland.)

Baroness Blatch: My Lords, this is the noble Baroness's first Bill, as she said. I want to put on the record my warmest congratulations and thanks to her. She has listened carefully, written copious letters of explanation, made herself available throughout the Bill and always been most courteous both in and out of the Chamber.
	For the sake of time and all those noble Lords around me who are looking impatient, I do not want to name everyone the noble Baroness named. I simply wish to ask to be associated with many of the tributes she made to noble Lords around the Chamber. I would like to thank the noble Lord, Lord Davies of Oldham, and the noble Lord, Lord McIntosh of Haringey, who have been assiduous in their help to the noble Baroness.
	By convention, Members of this House carry out their work assiduously. We take seriously our responsibilities to revise legislation. Individual Members on all Benches have given no quarter in their attempt to champion areas of concern, often playing devil's advocate on behalf of those on whom the legislation ultimately has an impact. Unfortunately, that cannot be said about Members of another place.
	We have not made allowances for the noble Baroness, but she has risen magnificently to the challenge on her first and very major Bill. I congratulate her most warmly.

Baroness Sharp of Guildford: My Lords, when the Bill first came to this House in the spring, a number of us greeted it by asking what its purpose was. As a result of our deliberations over the past couple of months, many of us have come to understand its purpose slightly better, although it remains in many senses a portfolio Bill, as many Bills do, and at times somewhat disjointed.
	I join others in paying tribute to the Minister and to the noble Lords who have been helping her: the noble Lord, Lord Davies of Oldham, and the noble Lord, Lord McIntosh of Haringey; and particularly to the Bill team. I congratulate the Minister on the spirit in which she has conducted proceedings. She has listened attentively to our concerns and has responded more positively than I have ever known a Minister respond by tabling many amendments taking account of the issues we raised.
	It was the Minister's first Bill, and as the noble Baroness, Lady Blatch, said, she has done brilliantly. I thank all noble Lords for their help.
	On Question, Bill passed, and returned to the Commons with amendments.

Football Clubs

Lord Clark of Windermere: rose to ask Her Majesty's Government what proposals they have regarding the ownership of football league clubs.
	My Lords, I declare an interest as a board member of the Carlisle and Cumbria United Independent Supporters Trust Limited and as the owner of a few shares in Carlisle United AFC. It is apposite that I mention Carlisle and football, because those of us from Cumbria are all aware that the first game of organised football was played on the green sward beneath the magnificent castle of Carlisle. I leave it to your Lordships' imagination to conclude what was used as the ball.
	Over the past month it has become clear that there is no dispute whatever over what is the national game of England, Scotland, Wales and Northern Ireland. The fact that it could halt the rush hour in our cities and towns at 7.30 in the morning when the World Cup was being screened makes the point that our national game is football.
	I would like to say how proud I was of the English football team. We did not expect much of them when they went out. They got into the last 16 and they were victims of their own success. The outcome was that the beautiful game of football was seen by millions, but there is a problem in England with the ownership of certain football clubs. Indeed, the football taskforce in its fourth report talked about football in England being damaged by scandals. Many issues are involved, but I want to concentrate on two: those of franchising and of fit and proper persons.
	I wish to thank the Football Association, the Football League, Supporters Direct and the Professional Footballers Association, with whom I discussed many issues, for their co-operation in helping me to prepare for the debate. I am very much aware that they are conscious of these issues.
	My locus for initiating the debate goes back to last November when Michael Knighton, the owner of my local football club, Carlisle United—he is better known as the man who nearly bought Manchester United—invited myself and the chairman of the supporters trust to help him to sell the club. We agreed to do so. Over the past eight months I have learnt much about the business of running a football club and its associated difficulties. I have become wise about such matters as receivership and liquidation. Carlisle United is now in voluntary administration.
	I am also aware that many of the difficulties that we face in the United Kingdom emanate from the fact that we have some of the earliest football clubs. Initially that was what they were—football clubs. However, as the clubs became professional, they took advantage of the companies legislation to form limited liability companies. I sometimes wonder, if clubs had not pursued the route of the companies legislation but had instead followed the route of the industrial and provident legislation, whether they might have found it easier to tackle some of the problems with which they are faced today.
	However, it is argued that football clubs are companies and therefore should be treated like any other company. Like many others, I dispute that view for many reasons. Suffice it to say that football clubs are unique and have a unique relationship with their customers, their supporters. Their supporters do not switch their support to get a better deal. We would not have many supporters at Carlisle United if that were the case. Supporters want success but that is not essential; they continue to support the same team.
	In a sense that highlights the "guts" of the problem. Although football clubs are companies, they are also a community asset. That is what differentiates football clubs from other companies. It is interesting to note that when football clubs get into near terminal difficulties, communities usually rally round to save them. Whether it be Brighton or Doncaster, Bournemouth or Northampton, Portsmouth or Lincoln, fans and communities have tried to save their clubs. Indeed, one can regard ownership of a football club as 80 per cent proprietorial and 20 per cent community. Thus it follows that fans have a place in the running of football clubs. Carlisle United's trust has a handful of members—fewer than 1,000—who pay £3 a week into a fund to buy shares and eventually a seat on the board. That model has been followed by 56 other clubs. We are getting the message across.
	But there is a further aspect of community involvement which came home to me forcefully last April. Michael Knighton rang my colleague, and later repeated to me, the devastating news that in his opinion the people of Cumbria did not deserve a Football League club and that it was his intention, unless he received an apology from the independent supporters trust and the local newspaper, News and Star, to take Carlisle United out of the Football League. He said that he would board up the ground, lock the gates and that we could all watch the weeds grow. I felt that that was wrong. I do not believe that any individual has the right to do such a thing with a community asset. I understand that a club should leave the Football League if it is not good enough or if it goes bankrupt, but a viable Football League club should not be forced to leave the League under the circumstances I have mentioned.
	I believe that it is equally wrong for people to purchase clubs to move them elsewhere. I think of Wimbledon in that regard. Only this week Clydebank was bought and will be moved to Airdrie. It will play in the Scottish League in the coming season as Airdrie United. I am delighted for the people of Airdrie. However, I am not sure that people should buy clubs and move them from one town to another. There are huge question marks in that regard. We are following an American route with which I certainly do not agree.
	But perhaps the main worry of many of us who are interested in football clubs concerns the characters of a few individuals who own, or have a burning desire to own, a football club. In saying that I pay tribute to the overwhelming majority of football club chairmen, owners and directors who love their clubs and are as much fans of their clubs as those who stand on the terraces and pour their money down the drain labelled "football". However, a few individuals give cause for concern. I shall not list them as we all know who they are.
	But when I read that Giovanni di Stephano is on the point of purchasing Northampton Town, I shudder. I understand that he was the right-hand man of Arcan, the Serbian warlord and indicted war criminal. He held the rank of general in the Serbian army and has been arrested on more than one occasion by the British police. He has been involved in United Nations sanction breaking and currently boasts that he is Milosevic's legal adviser and that he counts people such as Saddam Hussein as his friends. I simply pose the question: is he a fit and proper person to run a football club in the English Football League? I believe that there should be a "fit and proper" test for all Football League chairmen and directors. If it is impossible to legislate in that regard, the Football League ought to introduce such a test as a condition of membership of clubs in the league, as, indeed, does the Jockey Club.
	In 1999 the owner of Doncaster Rovers, Ken Richardson, was sent to prison for four years for conspiracy to burn down the club's main stand. Following a conviction in 1984 of conspiracy to defraud in a race, the Jockey Club banned the same Mr Richardson from racing for 25 years. Doncaster Rovers might still be a member of the Football League if that league had a "fit and proper" test, as does the Jockey Club.

Lord Henley: My Lords, like the noble Lord, Lord Clark of Windermere, I declare an interest as a supporter of Carlisle United who has followed them for many years and who lives very near to Carlisle. I believe that the first match I attended was in the 1965–66 or 1966–67 season. All I can remember is that we beat Bury 4-1.
	It is a great privilege to follow the noble Lord, Lord Clark of Windermere, a fellow Cumbrian. I hope that other speakers in the debate will forgive us for taking a slightly provincial approach in raising concerns relating to our local team, Carlisle United. I hope that they will also recognise, as the noble Lord, Lord Clark, made clear, that the issues go much wider than Carlisle United and affect many clubs in all parts of the kingdom. Although these matters are not necessarily primarily concerns of Her Majesty's Government, they are matters that concern a large number of people up and down the country. Therefore, it is a good thing that we have found time to debate these concerns in this House.
	I make it absolutely clear that, as a good Conservative, I strongly believe in the rights of property and, despite the wording of the Unstarred Question in the name of the noble Lord, Lord Clark, I do not believe that the Government should take on themselves some role involving interference in the ownership of football clubs. We have seen nationalisation in the past and we know that it does not necessarily work, and we have seen other ways of regulating ownership, which can be equally dangerous.
	Having said that, I agree with the noble Lord, Lord Clark, in his use of the phrase, "a community asset". A club such as Carlisle—or any football club—is of vital importance to the people of its area and those who support it. They do so in large or smaller numbers. As we all know, the numbers of people supporting Carlisle have dropped rather dramatically of late but we hope that in due course, as the situation is resolved, the numbers will go up. They are interested in the success of their local club. When it achieves extraordinary results, that can have a much wider effect on the area itself. Many of us will remember—I believe that it was in 1973—when Sunderland won the FA Cup when it was in the Second Division. That had a knock-on effect in Sunderland and on the rest of the North East, not just in terms of general morale but also, some argued, in terms of beneficial economic effects.
	A club, although it belongs to its various shareholders and sometimes to a sole owner, has a greater importance to its locality than many other—most other—businesses. That is why, although I stressed earlier my strong belief in property and the rights of property, one occasionally has to remember the words of a former leader of my party and a former Prime Minister, Mr Edward Heath, whom I do not often quote. When he referred to:
	"The unpleasant and unacceptable face of capitalism",
	he was making a very good point. The owners of many of these clubs must remember that they do not simply own the club for their own personal gratification and—possibly—their own enrichment. The noble Lord referred to various owners with a rather dodgy background; there are many other owners whose interest is not necessarily in football. They may be property developers, for example, and have an interest that goes beyond that of the club and involves some other end in itself. All those owners have a duty to consider the wider concerns of the community in which the club is based and from which it draws its support.
	The noble Lord, Lord Clark, discussed what has been happening at Carlisle during the past few years under the ownership of Mr Michael Knighton. He gave some idea of the strength of feeling in Carlisle about that ownership and he stressed the importance of the Carlisle United independent supporters trust, which is trying to create some support and raise money so as to buy shares in the club in due course and to get some influence over it. He also—I hope that he will not mind my mentioning this—reminded me that during the local elections earlier this year, we saw far more "Knighton Out" posters dotted around Carlisle than we did Conservative or Labour posters. That gives some idea of the strength of feeling in the area, particularly about the ownership of the club by Mr Michael Knighton and his threat to close the club. Those matters are clearly documented in the local press.
	I do not wish to elaborate on that but I want to draw attention to one aspect of Mr Knighton's behaviour which bears some repetition; that is, his almost "sub-Maxwellian", if I can use that phrase, attempt to silence his critics, particularly those in the local press. A press release has recently been drawn to my attention that was issued by Carlisle United, presumably on behalf of Mr Knighton. It refers to criminal proceedings and possible legal action against Mr Knighton's detractors. Some of it deserves to be drawn to the attention of the House. I hope that noble Lords will not object if I quote one or two passages from it. It gives some idea of what I have called the sub-Maxwellian approach of Mr Knighton.
	The press release is entitled:
	"Criminal proceedings possible over Knighton detractors".
	It goes on:
	"Senior Barristers from London are pawing over reports and dossiers (five feet high)"—
	I rather like the expression "pawing" over reports and dossiers five feet high—
	"of the activities of those people who have tried to oust the Knighton family from the ownership of Carlisle United.
	It is believed Mr Knighton has been advised by an experienced legal team that he has a strong case to bring criminal proceedings for: defamation of character, conspiracy to defraud . . . victimisation, false and malicious allegation, professional negligence, libel, slander",
	and so on and so forth. It continues:
	"Lawyers believe there may be no fewer than 13 individuals who may be named on the court petition should Michael Knighton take the lawyers advice given to him by some of the Country's leading Barristers who take on such cases".
	Parts of the press release are quite laughable. It goes on to refer to:
	"A new independent Owners, Chairmen and Directors Association (CDA) whose founder members include the respective Chairmen of Bristol Rovers F.C, Blackpool F.C, Southend F.C and Darlington F.C are said to be backing the case".
	I should point out, as the noble Lord stated, that the former chairman of Doncaster had a criminal conviction. The chairman of Blackpool FC has recently served time for rape and the owner of Darlington FC is a convicted safebreaker.
	That is the gist of what we are hearing from Mr Knighton. As I said, it is sub-Maxwellian. It has all the feel of that other late owner of a football club, Robert Maxwell, who owned Oxford United. I refer to his use of writs and legal frighteners of a sort that many of us find particularly distasteful.
	I do not suppose that Mr Knighton has any case at all; I doubt even the existence of senior lawyers offering such advice and "pawing" over dossiers some five feet high. He is simply trying to prevent legitimate criticism of his own actions as owner and former chairman by the local press and others.
	I end with a brief question for the Minister. I do not expect an answer from her because I believe that it is a question for the noble Baroness's colleagues in the Department of Trade and Industry. However, I should be grateful if she would pass it on to them and arrange for an answer to be sent to me in due course.
	Some years ago—I believe that it was in September 2000—Mr Knighton was disqualified from acting as a director of any company. Following that—such is the way in which such people act—he put his 24 year-old son and one other in his place as director of Carlisle United Football Club. As I understand the law—I can no doubt be corrected if I am wrong—anyone so disqualified should not be directly or, more importantly, indirectly involved in the management of a company, having been so disqualified. It seems to me, from his actions and his press release, that he has been involved, and is still actively involved, in the management of Carlisle United.
	I ask the Minister to ask her colleagues in the Department of Trade and Industry—unless she has an answer tonight—how that policy is policed and what, if any, action can be taken against an individual who has been so directly or indirectly involved despite being disqualified?

Lord Faulkner of Worcester: My Lords, football supporters everywhere will welcome this evening's debate and congratulate my noble friend Lord Clark on initiating it. As a Carlisle supporter, he is well qualified to speak about football club owners who behave in a strange way, as is the noble Lord, Lord Henley. Both noble Lords spoke effectively and with great force.
	This is a most timely debate. As the euphoria of the World Cup disappears, football clubs across the country are facing the reality of worsening economic circumstances, which are caused mainly, but not entirely, by the collapse of ITV Digital. There will be many more clubs in financial difficulty as owners who have hitherto been regarded as benefactors attempt to recover the money that they put into clubs or seek to cash in on whatever assets their club possesses, whether they are players who have a value in the transfer market or—much more threatening for the club's survival—the property that it owns.
	I have two unpaid interests which I should declare in this debate. First, I am associate director of Oxford United Football Club, which plays in the third division of the Football League, and which was rescued from extinction by its present owner, Mr Firoz Kassam. I was previously a member of the board of Brighton and Hove Albion, appointed as a "public interest" director on the advice of the Football Association at a time when the club was close to disappearing and there were rival shareholder factions whose disagreements, had they continued, could have proved fatal. Secondly, I am an elected member of the Dons Trust, which was set up under the auspices of Supporters Direct, originally to give supporters of Wimbledon Football Club a stake in that club and a say in its decision-making. I say "originally" because since the Dons Trust was formed, events at the club have taken a bizarre and disgraceful turn, as I shall explain in a moment.
	The three clubs with which I have been associated, Brighton, Oxford and Wimbledon, have one thing in common: each faced enormous difficulties over its grounds. Brighton's and Wimbledon's were sold by their owners, who profited immensely in the process but failed to provide or invest in a new ground. In Oxford, work started on a new stadium but was suspended with the ground half built. Once Mr Kassam took over, he got the stadium finished and that club can now face the future with confidence. The boardroom disputes at Brighton were also resolved. The club moved back into the city and in successive years won the third and second division championships. They now await the go-ahead for a new stadium and the outlook there is much more cheerful.
	However, that is not so at Wimbledon. I start with a little history. Today's football club was founded in 1889 as Wimbledon Old Centrals and played on Wimbledon Common. It moved to Plough Lane in 1912, and stayed there in the heart of the local community until 1991 when it embarked on what was expected to be a temporary ground share in Crystal Palace's ground in the neighbouring borough of Croydon as it was decided—wrongly, as a recent feasibility study demonstrated—that the Plough Lane ground could not be brought up to the all-seated standards demanded by the Taylor report after the Hillsborough disaster.
	During the 103 years of its existence, the club enjoyed periods of extraordinary success, including winning both the FA Amateur Cup and the FA Cup, and was elected to the Football League in 1977. Within nine years it had been promoted to the highest league, where it stayed until its relegation two years ago. During the 1980s and 1990s the principal shareholder and owner of the club was Mr Sam Hammam, a charismatic though at times controversial figure who sought, often successfully, to motivate his players by unconventional means. Mr Hammam bought the disused Plough Lane ground from the club and then, in 1994, sold it to Safeway for development for £8 million. Most football supporters believe that the gain which was realised, well over £7 million, should have gone back to the club and been invested in a new ground.
	In 1997 Mr Hammam sold 80 per cent of his shareholding to a Norwegian company, AKER RGI, for around £25 million. It is believed that the Norwegians, Mr Rokke and Mr Gjelsten, invested in Wimbledon because they believed that the club would move to Dublin and take its Premier League membership with it. To the short-lived relief of its supporters, whose views had not been sought on any of those matters, the English and Irish football authorities blocked that move.
	The next step came in April 2000 when Mr Hammam sold his remaining interest to a company in which the current club chairman, Mr Charles Koppel, is a shareholder. Relegation from the Premier League followed immediately. There then followed a campaign led by Mr Koppel backed by expensive lawyers and PR consultants to win support for the club's move from Selhurst Park, not to a ground in Wimbledon, elsewhere in Merton or, indeed, anywhere in London, but to Milton Keynes, over 60 miles away, where developers offered it a ground, effectively for nothing.
	The matter was considered by a series of football authority committees and commissions and was finally resolved by a three-man team on 28th May. It received evidence and submissions from a wide range of organisations, including the Football Association, Wimbledon supporters and Merton Council, all of which were vehemently opposed to the move to Milton Keynes.
	The commission's report is extraordinary. It bears reading and can be found on the FA's website. It contains these words:
	"We find the cherished and fundamental principles of football in this country in relation to the pyramid structure and promotion and relegation on sporting criteria alone, admirable. Likewise we respect, value and would seek to uphold the community basis of football clubs.
	We do not wish to see clubs attempting to circumvent the pyramid structure by ditching their communities and metamorphosising"—
	that is not a word in my dictionary but it is in the report—
	"in new, more attractive areas. Nor do we wish, any more than the football authorities or supporters, for franchise football to arrive on these shores".
	Yet, despite those admirable sentiments, the commission determined by a two to one majority to approve the move to Milton Keynes. It appears that the only piece of evidence which influenced it was the threat by the owners to liquidate the club if the verdict went against it. In what is, frankly, an insult to the intelligence, the commission suggested that in perpetuity there should be a corner of Milton Keynes that would be for ever Wimbledon; that street names be changed to represent names similar to those in Wimbledon; that the area of the stadium be called "Wimbledon Park" and that special subsidised trains run from Milton Keynes, and so forth.
	The truth is that the commission is allowing the owners to steal the club from its supporters and the community of Wimbledon. It is establishing a precedent which will allow other Football League sides to be relocated by their owners anywhere in the country and the principle of a franchise is being established for league membership. There is no right of appeal against the commission's decision. The football authorities say they oppose it but can do nothing.
	The one remaining hope is the Independent Football Commission, the final stage in the complaints hierarchy set up as a result of the recommendation in the fourth report of the Football Task Force, to which my noble friend referred and on which I had the honour to serve as vice-chairman. The phrase,
	"the final stage in the complaints hierarchy",
	comes from the chairman, Professor Derek Fraser. Professor Fraser speaks of,
	"its potential for ensuring public confidence in what is our national game, a national institution and an important part of our culture and heritage".
	The Wimbledon case will be its first big test and will be crucial in establishing whether self-regulation of football can really work and establish public confidence. It is that which lies at the heart of the debate tonight and in the Unstarred Question asked by my noble friend. I hope that the answer he receives will be that the Government see the real owners of football clubs as being the supporters; the people who follow the team in good times and bad over the years.
	Directors and owners should see themselves primarily as guardians of a public asset, as temporary custodians of an entity in which others, such as supporters and the local community, have a genuine stake. In the case of Wimbledon, the club existed for over 100 years before the present owners took it over. It is therefore not just another investment for them to do with what they like.
	The supporters, to their immense credit, are determined to keep senior football going in Wimbledon and through the Dons Trust have formed a new club, AFC Wimbledon, which won election to the Combined Counties League. While there is still uncertainty about where the other Wimbledon club will play next season—incidentally, it is now known mainly as "Franchise FC" not "Wimbledon FC"—AFC Wimbledon will start in August at Kingstonian's ground, just down the road in New Malden. I wish them well and so, I hope, do all Members of this House.

Lord Burlison: My Lords, I thank my noble friend Lord Clark of Windermere for bringing this debate before the House and for giving us the opportunity to talk about football when the rest of the country is probably fed up to the back teeth with it. I agree with my noble friend's suggestion that there is a need for credible people to run football clubs. I hope that Carlisle United resolves its problems before the start of the new season. The club has a proud history and has actually played in each of the leagues. I am sure I do not have to tell my noble friend Lord Clark that for a very short time the club topped the whole of the Football League—a record that I wish Hartlepool could reflect on.
	At this point I should declare an interest, as I am a president of Hartlepool United. At the outset of my remarks, I should stress that there are many good chairmen and directors of football clubs in this country. In fact, the great majority of people who run football clubs are honest, hard-working and care deeply about the game. I know that both Freddy Shepherd of Newcastle United and Bob Murray of Sunderland are respected for their loyalty and commitment to their own clubs, and to the North East generally. They both play a very active role in their respective communities—long may they continue to do so.
	I do not wish to compare the activities of the premier league clubs with some of the things that have gone on in the lower leagues. I am clearly of the view that the problems of the premier league teams are different from those experienced by the third and fourth division teams. However, I am equally certain that all football clubs should be owned by decent people who have a responsibility to the area where they are located, as well as to the shareholders or the owners of the football club.
	I should like to take a little time to talk about some of the problems that the smaller clubs have in modern-day football. It has been my experience, both as a player and as someone who has been involved in the game, to know that smaller clubs could not exist without the commitment and financial resources of the chairman and the directors. For example, in the case of Hartlepool—my association with them goes back many years; in fact, to the 1950s—I know that all the chairmen have been reputable, caring people who have wanted to do a job not only for the club but also for the town.
	I also know that the club takes pride in its financial transparency. The club secretary, Maureen Smith, is always quite happy to give doubters a run-down on the system used to check the gate receipts and other aspects of the club's finances. I am also pleased to see that every payment made, whether it be to players or staff, is declared to the taxman; of course, that is how is should be in any case. I am also mindful of the role that the chairman plays and of how difficult it would be for the club to survive if Ken Hodcroft and the company for which he works—a Norwegian oil company—withdrew their support.
	Ken not only runs the club with his fellow directors, Harold Hornsey and Ian Prescott, but also contributes most of his spare time to the club's affairs. I am deeply sorry that both he and the town were not rewarded last year by getting promotion, which they narrowly missed. They have now missed it for three years running. However, as the team was clearly the best side in the third division at the end of the season, I am sure that they will achieve promotion this year without the need to involve themselves in the play offs.
	I should like to make a point on crowd behaviour. Once again, perhaps I may use my own club Hartlepool to demonstrate my point. We have an excellent crowd at Hartlepool. A lot of credit for this must go to the directors, especially the manager Chris Turner who spends time on talk-ins with the supporters and has generally built up a good rapport with them.
	An outstanding example of how the club views its role in this respect was seen a couple of years ago during a Sky television broadcast, which featured Halifax and Hartlepool in a league game. Unrest broke out among the Hartlepool supporters because, due to ground alternations, they had been put into a corner of the ground that was the worst area from which to see the game. That is not to blame Halifax in any way. Indeed, I am deeply sorry that Halifax lost its league status last year and has been relegated. I have many happy memories of the Shay, and I hope that the club will be back into league football very soon. However, on seeing the crowd problems arising, the then chairman of Hartlepool, Harold Hornsey, waded into the supporters to calm them down. I thought that that was an absolutely magnificent gesture. It was a clear indication of that man's love for the club, and for football. I wonder how many other chairman would do the same. I can recall watching the broadcast on Sky television on that occasion. The only comment made on the programme was, "There's an official trying to help". I thought that the chairman's efforts deserved something a little better than that simple comment.
	The current crisis with television cash is a worry. I have no doubt that too many clubs have become much too reliant on their share of the money. If the issue is not satisfactorily resolved, it may have a profound effect on many clubs. I know that some of the first division clubs, especially those with heavy wage bills, will find it very difficult to keep going on the same basis. However, I believe that many of the third and fourth division clubs will manage because they have smaller wage bills; and, in general, they raise their own players—which I think is the way forward for the future.
	We have just had the experience of the World Cup, which I felt we were well placed to win this time had we just been a little hungrier, say, like the Irish or the Koreans. Nevertheless, it was a good performance upon which I believe we can build for the year 2006. It may stand us in good stead for the European championships in 2004. We must have a vibrant system for producing young players for the future. The Youth Development Fund, with its supporting agencies, is an excellent way to develop young players but it needs to have substantially better funding. We should not leave this solely to the football clubs or to the colleges where they run academies. Somewhere in between, I believe that we have the right ingredients to, once again, put Britain on top of the football world. To achieve this goal we must have credible people running football. We must ensure that smaller clubs that play by the rules are helped to survive.

Lord Addington: My Lords, we must thank the noble Lord, Lord Clark, for bringing this matter to our attention.
	On the face of it, football merely looks like a professional occupation consisting of men running around and people trying to make money by attracting fans and selling TV rights. But it is not. Indeed virtually all professional sport involves a degree of emotion and time spent trying to connect with the soul of a community. What they mean to that community is one of the reasons football teams survive.
	Only we have a structure where stray teams can struggle on; for instance, not so much moving up and down the league tables, but struggling on in the middle of nowhere, achieving nothing and not progressing for a long time. That is the fate of most professional sporting clubs for most of the time; it has to be.
	That is why this is such an interesting subject. It is not about economics; it about what a professional sporting activity designed to attract viewers and fans means to the community in which it finds itself. The same is true of Rugby League and other professional sports, though Rugby League is probably the only one that comes close, with the exception of one or two Rugby Union clubs in certain parts of the country.
	So what happens in professional football is of great interest to government. Many of the points raised by the noble Lord, Lord Clark, are interesting, but the Government do not have much control over them. That is the problem we face. They are professional activities selling a form of entertainment.
	When it comes to the idea of franchising we must be extremely careful. The Americans have proven that the best way to make money out of sport is to have a guaranteed franchise with a guaranteed feed-in of players from the selection categories. American baseball and football displays that. Once a team has achieved its status it is not relegated. So it can take the bad seasons. It will always have the right level of competition to attract the fans. That is a way that makes money out of sport. But it runs totally against our culture.
	The amount of hurt that seems to come out when people do not feel that those in charge of their sporting club are putting enough into it is a flip side to the actual misbehaviour of those at the top. I come from Norwich. We had a man called Robert Chase in charge of our football team who was hounded out of that position. "Chase out" became a chant that rang throughout the city. He was running it as a professional organisation to make money and it was seen as not the thing to do. He was expected to pump money in to ensure that the team remained at the top, but he did not. Alan Sugar at Tottenham Hotspur received a similar version of that reaction; keeping the club financially stable but not spending money—I hasten to add that that information came from a Tottenham fan.
	But the idea that the football club is something different goes against its legal status and the reality. Those two situations along with the amount of money being pumped into football have come to a head. In addition we have the withdrawal of money from ITV Digital for those clubs below the Premiership. Football may well be at a cross-roads. It is a fashionable image of late; for instance, it is now the middle class game of choice. People who 10 years ago would not be able to name their local football team now talk about it quite knowledgeably, in wine bars as opposed to pubs. It happened briefly in Rugby Union and that all went sour. Once the corporate hospitality boxes become a little more difficult to sell, one wonders what will happen. And if anything becomes fashionable, by the rules of history it will become unfashionable and something else will replace it.
	So in football we seem to have a cultural position that does not respond to the laws of the market. Will the Government intervene to try to encourage the FA to ensure that we have fit and proper tests or a version of them? In theory we may think that is a good idea. Then we consider how on earth we can draw them up. Do we take into account spent convictions, convictions for certain types of activity or somebody who is simply regarded as being unpleasant? Civil rights lawyers are salivating at the thought. We could go on forever with that argument.

Lord Faulkner of Worcester: My Lords, can the noble Lord say why the Jockey Club is able to exercise rules exactly like that and keep out of racing people whom it believes are not fit and proper persons?

Lord Addington: My Lords, I wonder how many people in the Jockey Club are dealing with limited companies. These are limited companies. The Football Association will have to take that on board. The Government will not be able to. And I am sure the lawyers will get round to the Jockey Club eventually.
	In calling for such changes, we must be careful about what we are trying to achieve. If the Government are prepared to say that it is part of the cultural integrity of the community and that they defend local football clubs, that is one thing. However, if they are merely letting businesses carry on, that is something else. I do not like what I am saying, but it is the reality of the situation. The economics are probably against the nature and structure of football and the many full-time professional clubs.
	We must address the facts. I do not say that it is easy but we must square up to the task. I approve of promotion and relegation. It encourages people to take part in sport, especially at the highest level, but it puts a strain on the structure of smaller clubs which aspire to climb higher. It makes them vulnerable to the supposed "white knight" who comes in to make money, or for an ego boost, or because he genuinely loves the sport or the club. It is in the nature of things that they will come together.
	This is a speech in which I am afraid I can offer arguments but not many answers. But the people in football are the only ones who can deal with the ownership issue. As regards moving clubs around, the Football Association must square up to the fact that if it wants the game to continue as it is, it must defend the smaller clubs, which realistically will not make the premier league within the lifetime of anyone here today—that is, unless some others are struck by lightning.
	We must applaud the greater involvement of fans in the running of clubs. However, in professional support we have a horrible situation in that we are all heavily involved. Unless we are prepared to move in and take responsibility for the financial running of the clubs, we cannot make many rules. I can say only that we must remind the fans when they complain, "Remember that when people are making money out of your club and are buying players, you are the ones who ultimately will have to fund that either through a change in your habits or through your pockets".

Baroness Buscombe: My Lords, I congratulate the noble Lord, Lord Clark of Windermere, on asking this Unstarred Question. I have canvassed a good number of people of all ages for their response to the question. The overwhelming response has been, "It's up to the clubs, not the Government, to run their show". That said, I quickly turn to an extract of the third report of the Football Task Force, Investing in the Community, wherein it is stated:
	"The ownership of football clubs—particularly those in the lower divisions—needs reappraisal. New models of ownership, such as supporters' trusts and community trusts, could provide a means of improving increasing democracy and accountability whilst building strong community links for the long term".
	In other words, reform of the structure and the running of clubs is to be encouraged and we very much support that view.
	While it is important not to lose sight of the fact that football has a longstanding, deep-rooted amateur tradition, and while that must be a good thing, there is clearly a need to question whether that amateur tradition can continue to survive when focusing upon the structure and management of the clubs. I must confess to your Lordships that while researching the question, I found a paper written by Tom Cannon and Sean Hamil, which is included in a book entitled Football in the Digital Age: Who's game is it anyway?, to be particularly helpful, for which I thank the House of Lords Librarians. The chapter is entitled "Reforming football's boardrooms" and I shall quote from it briefly:
	"When the structure of the clubs is examined more deeply, the amateur tradition continues to dominate, with few dedicated or qualified staff in key business areas and little dedicated training and development in leisure or sports management, marketing, customer service, media relations, finance or people management. This amateur tradition is suddenly faced with taking on new roles, which are expected of their enterprises, and of their fans . . . the shareholders, the directors and the employees of the businesses".
	The paper goes on to state that there needs to be a clearer view or set of views at the top about the levels of professionalism and the true skills that are required to manage clubs efficiently. And the challenges facing football clubs have to be addressed at a professional and strategic level. At the core has to be a strong sense of the club's purpose.
	While individual clubs are generally small businesses and have their own sense of identity, collectively, football is now big business and as such is, as we are now witnessing, vulnerable to risk and new challenges as any other business, particularly given its recent changing environment and funding issues.
	With regard to funding, will the Minister give us some reassurance today in respect of those clubs which have been so badly affected—indeed, endangered—by the failure of ITV Digital?
	Although we do not believe that the Government should regulate in this area, they have a responsibility to put pressure on those responsible for the failure of ITV Digital. They should accept that responsibility and act accordingly. The desirability for those responsible for that failure to compensate, at least in part, those clubs that are now especially vulnerable is surely overwhelming. Does the Minister agree?
	Many of those clubs will struggle to survive because of the loss of their income stream. In the end, football needs to negotiate new television deals. For that reason, are the Government concerned at the prospect that the new digital terrestrial service contract to be announced tomorrow will be for only free-to-air with no pay-per-view services? How can the Nationwide League clubs then be expected to exploit the commercial opportunity of negotiating a new pay-per-view contract with another broadcaster?
	Free-to-air digital television only, with no option for pay-per-view, spells no competition for bidding for sports rights such as that for the Nationwide League. Nationwide League and other fixtures are clearly unsuitable for normal, analogue, free-to-air channels such as BBC 1 and Channel 3 because analogue does not have the spectrum. However, football league club matches are ideal for pay-per-view digital channels. Do the Government have a strategy for those clubs, especially in relation to their ability to resell the rights competitively?
	There are also real concerns about the internal affairs of some clubs. For example, I understand that the directors of York City circumvented the rules by placing the club's assets, including the ground, into a holding company, with the result that when they sold the club they were able to sell the assets separately. The affairs of Carlisle United Football Club also make disturbing reading. I listened with great interest to what the noble Lord, Lord Clark, and my noble friend Lord Henley said about the club and its now uncertain future.
	I also listened with interest to what the noble Lord, Lord Faulkner of Worcester, had to say about Wimbledon Football Club. I declare an interest as caring very much about the future of Wimbledon Football Club and the proposed move to Milton Keynes, because I was brought up near Wimbledon. Although my knowledge of the subject is not deep, I understand the geography and when decisions clearly offend both good common sense and the wish of the community—in this instance, the people of Wimbledon. After all, football clubs stem from and should surely remain at the heart of community life. Watching football is one of the few universally popular pastimes that brings and holds communities together. It binds generations.
	We understand that some would like the Government to be given power to intervene in the running of clubs—for example, with regard to ticket pricing and corporate hospitality—on behalf of the fans. It must be said that fans are already more inconvenienced by the timing of games shown live on television.
	It is reasonable to propose that the Football Association should have greater regard to the probity and overall suitability of football club directors. Frankly, events have shown that some of them are simply not up to the job—something to which several of your Lordships alluded. However, that is not something for which we should or could legislate. One cannot dictate calibre, and I suggest that strong supporter involvement in the running of clubs should, in theory at least, help to confront and expose shortcomings of directors. It should also deter those who think that ownership of a club is a route to a fast buck.
	As we have heard, the Government set up Supporters Direct to help groups of fans to acquire a stake in the ownership of their club. Several such supporters' trusts have helped to rescue clubs from bankruptcy, including clubs in Lincoln and Northampton. We agree that that is a good idea and understand that, as of 20th June, 59 clubs now have established trusts; 22 trusts have board representation; trusts own shares in 26 clubs; and trusts have been agreed at a further 14 clubs for later this year.
	At the end of the day, it must be for the individual club to decide, within its local community, how it will be managed. However, I shall end on an upbeat note by offering to your Lordships 10 reasons why the Football League matters. The Football League is the most watched live sporting spectacle in Europe. This season, over 15 million people watched the regular games and the play-offs. Those are the best attendance figures for 33 years. With crowds averaging over 17,000, Division One can boast attendances that are twice those of the equivalent divisions in Italy and France and are 50 per cent greater than those in Spain and Germany. Attendances in Divisions Two and Three are more than double the equivalent leagues in every other major footballing nation.
	Last season, Football League matches were shown in 136 countries, including countries as diverse as Botswana, Iceland and Iraq. Twelve of England's 23-man World Cup squad and 12 of England's 22-man squad for the European under-21 championship have played in the Football League. The Football League has proved, time and again, to be one of the most innovative forces in the modern game. Promotion and relegation, the play-offs, three points for a win, the golden goal and the 10-yard rule were all seen for the first time in professional football in Football League competitions. All 72 league clubs operate youth development programmes, 19 at academy level. Over 9,000 young footballers are on the books of our clubs, providing English football with its next generation of talent. In 1986, in tandem with the Professional Footballers' Association, the Football League founded Football in the Community. Each year, more than 1.25 million children and 7,000 schools take part. We remain the only country to place such a level of emphasis and financial investment on nurturing relations between football clubs and their local community.
	Since the Taylor report, the architecture of British football has been transformed. Today, 35 Football League clubs have all-seater stadia, and most of those grounds are capable of holding in excess of 20,000 fans. Last season, the Football League distributed £100 million of revenue to clubs. The Worthington Cup, which generates £80 million, is the most important redistributive mechanism left in professional football. Football League clubs employ over 2,500 professional footballers and thousands more full-time and part-time administrative and match-day staff.
	There is plenty to be proud of. We wish the Football League well and hope that it can overcome the various challenges that it faces.

Baroness Blackstone: My Lords, I am also grateful to my noble friend for asking the Unstarred Question. The ownership of professional football clubs is a subject of great interest to many in the House and far beyond. That is especially true at the moment.
	As the noble Baroness, Lady Buscombe, said, many Nationwide Football League clubs are struggling to adjust to the changed broadcasting conditions that followed the collapse of ITV Digital. A great many people follow the fortunes of their chosen club, as well as supporting England in the World Cup. In professing allegiance to an individual club, most followers of the sport take a close interest in the control and direction of that club. The extent of that interest has been clear in our debate.
	Many people also make considerable emotional investment in the performance of their chosen team. As every speaker has said, it is, naturally, important to them to feel confident that the teams are in hands that are competent and well intentioned. More than that, supporters require the owners of their club to conduct themselves as disinterestedly as, they imagine, they would themselves, if given the opportunity. It is a special form of disinterestedness, for, in the eyes of many supporters, the ideal controller of a football club must combine a fiercely partisan approach to the advancement of the team's sporting interests with an ability to put aside all thought of personal gain. My remarks are not intended as satire; there is a contradiction. Those who own and administer football clubs must strive to combine the roles of supporter and businessman or businesswoman.
	As the noble Baroness has just remarked, football is now a big business. Last year it turned over collectively more than £1 billion for the first time. As such, the sport must accept the full range of social responsibilities that come with such a position. It must also accept that its business activities and its corporate behaviour are, where appropriate, subject to statutory regulatory scrutiny. In common with other business sectors of comparable size, football must meet the standards required by the Companies Acts and by competition legislation, both of which apply to businesses across the economy. That point was demonstrated in the decision reached by the Competition Commission to refuse BskyB's attempt to acquire control of Manchester United in 1998.
	At this point I should say to the noble Lord, Lord Henley, that of course I shall pass his question to my colleagues in the DTI since I do not have the answer tonight. However, I agree with him and with the noble Lord, Lord Addington, about the role of government. Any discussion of this subject must begin from a recognition that the internal regulation of football is a matter for its governing bodies, not for the Government. The Football Association, the Premiership and the Nationwide Football League all have detailed regulations governing the ownership and corporate behaviour of clubs.
	But that is not to say that the Government have ignored the undeniable problems of ownership which have arisen in football. Over recent years the behaviour of a small minority of club chairmen has brought the sport into some disrepute. As noble Lords have pointed out, the report of the Football Task Force on commercial issues in football recommended a role for its proposed regulator in enforcing a requirement that only "fit and proper" persons should be allowed to run clubs.
	The Government considered that recommendation very carefully, as did the football authorities. "Fit and proper person" requirements exist in a number of other fields. For example, the issue of broadcasting licences is subject to such a test and the failure of individuals to pass that test has led to the revocation of radio licences in the past. But outside the wholly private sphere, such tests work only where they form part of a statutory regulatory structure.
	While clubs are private businesses, they are also public companies. They are subject to the regulations of governing bodies in so far as is appropriate for the purposes of fair sporting competition. Football has concluded that it would be impossible to enforce a "fit and proper person" requirement as it would not survive legal challenge. That is not a circular argument, although I realise that it is unwelcome to some. The Government have decided that a statutory, or quasi-statutory, regulatory structure for football cannot be justified. As such, we agree with the sport's governing bodies that a "fit and proper person" requirement would not be workable in football.
	The Independent Football Commission, launched by the Government and the football authorities in March of this year as part of the response to the Football Task Force, marks a significant improvement on the approach that was originally proposed. Its members are fully independent both of the clubs and of the governing bodies, as well as of the supporters' associations. It forms the apex of football's customer service structure, as well as considering a number of general commercial issues in football, with reviews of merchandising and ticketing arrangements as two of its first tasks.
	However, the commission has no responsibility with regard to issues of club ownership; rather, it has been established to consider, where appropriate, what might be called manifestations of poor corporate governance, in particular poor levels of customer service and overcharging. The Government believe that those kinds of issues are more immediately important to football supporters than matters of ownership.
	As my noble friend Lord Faulkner mentioned, the commission will consider the circumstances in which Wimbledon Football Club has been permitted to relocate to Milton Keynes. The Government are confident that the commission's consideration will be a balanced one. Notwithstanding that, this is essentially a matter for football and, in particular, for the Football League. As my noble friend said, an independent Football Association panel accepted in May that Wimbledon has no future in the London Borough of Merton. However reluctantly, the league has accepted that decision.
	The FA has expressed its concern that the decision,
	"should not in any way be seen as a precedent".
	But there are special circumstances. The club has been homeless for 11 years and is losing £20,000 a day. The Government agree with this view and prefer to see the Wimbledon decision as a one-off and not as the beginning of a football franchise system.
	My noble friends Lord Clark and Lord Faulkner are right to be concerned about the prospect of British football adopting a franchise system. In the United States, the right to compete in the National Football League—gridiron, not soccer—is, in certain circumstances, auctioned off to the city which bids the highest. The Government agree that such a system runs counter to the historic traditions of British football. We are confident that the sport's governing body shares that view.
	In responding to the independent panel's decision on Wimbledon, the Football League was reluctant to override its regulations governing the location of football clubs. The Government believe that that reluctance, which is fully shared by the FA, speaks volumes. There is no appetite for a franchising system on the part of the football authorities. They see the Wimbledon case as an exceptional reaction to the very specific circumstances of an individual club, and the Government share that view.
	However, I join my noble friend Lord Faulkner and add my best wishes to the many Wimbledon supporters who have helped to set up the newly-formed AFC Wimbledon, which will carry on the proud tradition of football in the London Borough of Merton.
	My noble friend Lord Clark and the noble Lord, Lord Healey, referred in some detail to the recent events at Carlisle United Football Club.

Lord Henley: My Lords, the Minister has mistaken me for the noble Lord, Lord Healey.

Baroness Blackstone: My Lords, I am sorry. Did I say, "Healey"? I do apologise.
	I do not object at all to what the noble Lord, Lord Henley, said about taking a provincial approach. As a Londoner, the provinces are very important in this respect. My department is fully aware of the concerns of the club's supporters. The Minister for Sport received a substantial petition last summer as part of the "Save our Club" campaign organised by the Carlisle News and Star. My right honourable friend was delighted to accept that petition and to set out his personal concern for the club in the pages of the News and Star.
	The Government remain fully aware of the important roles played by clubs such as Carlisle in their local communities, but hard cases make bad law. The special circumstances of individual clubs do not make the proposal to introduce a fit and proper person requirement either more workable or more secure in the face of a legal challenge.
	The noble Baroness, Lady Buscombe, asked about Nationwide League clubs and pay-per-view broadcasting. The sale of the broadcasting rights is a matter for the league and for broadcasters. Whatever the ITC decides about the future of ITV Digital's frequencies there will still be a possibility of pay-per-view football rights. But it is not for the Government to interfere in that market.
	As my noble friends Lord Clark of Windermere and Lord Burlison rightly said, most football clubs are owned and run by people whose sporting and ethical credentials are above question—including Hartlepool United. Incidentally, I wish Hartlepool better luck next year. But the Government do not underestimate the potential for club chairmen and owners to exploit both football teams and the communities that follow them.
	Noble Lords have referred to a number of possible measures which have been suggested in the past to ensure that ill-intentioned individuals do not damage the interests of the national sport. The Government believe that there is a valid alternative approach. Rather than seeking to exclude individuals or groups from club ownership, the better solution may well be to encourage supporters to take an active role in the running of their clubs. To its great credit, the Football Task Force enthusiastically proposed such an approach and the Government have fully implemented its recommendations in this area.
	I am extremely grateful for what has been said by all speakers in the debate. I should like to close on a positive note about the value of Supporters Direct. The Government underestimate neither the importance of football in our national life nor its vulnerability to financial exploitation. However, the accepted limits of government intervention in the workings of all sectors of the economy must apply to football too.
	Short of outright criminality, it is right that the Government should have no role in dictating who should or should not own a football club unless competition issues are involved. But there are other approaches. The Government take some pride in their role in establishing and funding Supporters Direct. I am grateful for what the noble Lord, Lord Addington, said. The consolidation of the involvement of supporters in the ownership and running of professional football clubs is an admirable aim in itself. It also represents a possible solution to many of the historic ills of the sport.
	We have had a very useful debate. Once again, I am grateful to my noble friend for raising these important issues and to all who have taken part in the debate.

House adjourned at seventeen minutes before ten o'clock.